Other things equal, a market-determined increase in the dollar price of the pound is associated with
A) revaluation of the dollar.
B) devaluation of the dollar.
C) appreciation of the dollar.
D) depreciation of the dollar.

Question

Quizplus · Accepted Answer

An increase in the dollar price of the pound means that it takes more dollars to buy one pound, which means the dollar has depreciated relative to the pound. Therefore, the correct choice is D, depreciation of the dollar.

Other Things Equal, a Market-Determined Increase in the Dollar Price