In the dollar-pound market,whenever there is an appreciation of the dollar,there is
A) an appreciation of the pound
B) a depreciation of the pound
C) a devaluation of the pound
D) a revaluation of the pound
E) no change in the value of the dollar

Question

Quizplus · Accepted Answer

Whenever there is an appreciation of the dollar, it means that the dollar has become stronger in comparison to the pound. This leads to a decrease in the demand for pounds and an increase in the supply of pounds, causing a depreciation of the pound. Therefore, the best choice is B - a depreciation of the pound.

In the Dollar-Pound Market,whenever There Is an Appreciation of the Dollar,there