In the foreign exchange market,the quantity supplied of dollars is 600 whereas the quantity demanded of dollars is 400 results in a:

Question

Quizplus · Accepted Answer

When the quantity supplied of dollars exceeds the quantity demanded of dollars in the foreign exchange market, it indicates a surplus of the domestic currency. This surplus is known as a balance of payments deficit, as there is more supply than demand for the currency. Therefore, the correct answer is B, balance of payments deficit of 200.

In the Foreign Exchange Market,the Quantity Supplied of Dollars Is