In a graph depicting the supply and demand curves for British pounds as well as the exchange rate (any foreign currency per pound), the supply curve of pounds is
A) downward sloping reflecting British demands for foreign goods
B) downward sloping reflecting foreign demands for British goods
C) upward sloping reflecting British demands for foreign goods
D) upward sloping reflecting foreign demands for British goods
E) horizontal reflecting a fixed exchange rate

Question

Quizplus · Accepted Answer

The supply curve of pounds is upward sloping because as the exchange rate increases, British residents are more willing to supply pounds to obtain foreign currency for purchasing foreign goods.

In a Graph Depicting the Supply and Demand Curves for British