Refer to the Information Provided in Figure 19

question 206

Multiple Choice

Refer to the information provided in Figure 19.4 below to answer the questions that follow. Figure 19.4
-Refer to Figure 19.4. The demand and supply of pounds are S₁ and D₁. Which of the following can change the equilibrium exchange rate ($/pound) to $1.50 and the equilibrium quantity to 400 pounds?

• A) British purchases of U.S.-made cars increase
• B) United States purchases of British-made cars increase
• C) the price level in Great Britain decreases
• D) income in the United States decreases

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Definitions:

Demand Schedule

A table that lists the quantity of a good that consumers are willing to purchase at various prices.

Maximize Profits

The goal of businesses to achieve the highest possible level of profit through revenue maximization and cost minimization.

Nondiscriminating Monopolist

A monopolist who charges all consumers the same price for its product, regardless of the quantity demanded or consumer preferences.

Marginal Cost

The investment needed to produce an extra unit of a product or service.