Suppose U.S. consumers start buying more English shoes and fewer U.S. shoes. What impact will this trend have on the foreign exchange market?

a. U.S. demand for foreign exchange, in general, and British pounds, in particular, will increase.
b. U.S. demand for foreign exchange, in general, and British pounds, in particular, will decrease.
c. U.S. demand for British pounds will increase, but the demand for foreign exchange will probably decrease.
d. U.S. demand for British pounds will decrease, but the demand for foreign exchange will probably increase.
e. There is no effect on foreign exchange.


A

Economics

You might also like to view...

One advantage of a fixed exchange rate system compared to a floating or managed float exchange rate system is

A) it is easier for central banks to control inflation. B) there is no need for government intervention. C) it allows the exchange rate to reflect demand and supply in the market. D) it eliminates the possibility of depreciation during a recession.

Economics

Which of the following is true about a monopoly?

A) Its demand curve is generally less elastic than in more competitive markets. B) It will always earn economic profit. C) It will always produce the same as a perfectly competitive firm. D) It will always be subject to government regulation. E) None of the above is true.

Economics

The cost of processors and memory has decreased dramatically in the past twenty-five years. As a result, we have seen

a. an increase in demand. b. an increase in supply. c. a decrease in demand. d. a decrease in supply.

Economics

The replacement of older products by newer improved ones is called

What will be an ideal response?

Economics