Assume that British corporations begin to purchase more supplies from the United States as a result of several labor strikes by British suppliers. This action reflects:
A) an increased demand for British pounds.
B) a decrease in the demand for British pounds.
C) an increase in the supply of British pounds for sale.
D) a decrease in the supply of British pounds for sale.

Question

Assume that British corporations begin to purchase more supplies from the United States as a result of several labor strikes by British suppliers. This action reflects:​
A) ​an increased demand for British pounds.
B) ​a decrease in the demand for British pounds.
C) ​an increase in the supply of British pounds for sale.
D) ​a decrease in the supply of British pounds for sale.

Quizplus · Accepted Answer

When British corporations purchase more supplies from the United States, they need to exchange British pounds for US dollars, increasing the supply of British pounds for sale in the foreign exchange market.

Assume That British Corporations Begin to Purchase More Supplies from the United