If the exchange rate changes from .50 pounds per dollar to .75 pounds per dollar, what has happened to the dollar?
A) It has appreciated and so buys more British goods.
B) It has appreciated and so buys fewer British goods.
C) It has depreciated and so buys more British goods.
D) It has depreciated and so buys fewer British goods.

Question

Quizplus · Accepted Answer

The dollar has appreciated because you now get more pounds for each dollar, meaning you can buy more British goods with the same amount of dollars.

If the Exchange Rate Changes from