The Figure Given Below Depicts the Demand and Supply of Brazilian

question 68

Multiple Choice

The figure given below depicts the demand and supply of Brazilian reals in the foreign exchange market.Assume that the market operates under a flexible exchange rate regime. Figure 36.1 In the figure:
D₁ and D₂: Demand for Brazilian reals
S₁ and S₂: Supply of Brazilian reals
Refer to Figure 36.1.Determine the equilibrium exchange rate and equilibrium quantity of Brazilian reals, if D₁ and S₁ are the relevant demand and supply curves for Brazilian reals in this market.

• A)10 pesos per real and a quantity of 150 reals
• B)6 pesos per real and a quantity of 250 reals
• C)8 pesos per real and a quantity of 150 reals
• D)8 pesos per real and a quantity of 250 reals
• E)6 pesos per real and a quantity of 200 reals

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Definitions:

Exponential Distribution

A probability distribution that describes the time between events in a Poisson process, showing how a process is spread out over time.

Poisson Distribution

is a statistical distribution that expresses the probability of a given number of events occurring in a fixed interval of time or space.

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Poisson Distribution

A probability distribution that indicates the likelihood of a specific number of occurrences happening within a certain time or space period, given that these occurrences happen at a constant average rate and are independent of the time elapsed since the prior occurrence.