If British real GDP rose relative to U.S.real GDP,there would be
A) a rightward movement along the supply of British pounds curve in the dollar-pound market
B) a leftward movement along the supply of British pounds curve in the dollar-pound market
C) a rightward shift of the supply of British pounds curve in the dollar-pound market
D) a leftward shift of the supply of British pounds curve in the dollar-pound market
E) the tendency for the supply of British pounds curve to become flatter in the dollar-pound market

Question

Quizplus · Accepted Answer

an increase in British real GDP would lead to an increase in demand for goods and services in Britain, resulting in an increase in demand for pounds. This would shift the supply of British pounds curve to the right in the dollar-pound market as there are more pounds available for sale at each exchange rate.

If British Real GDP Rose Relative to U