Refer to Figure 15.2 for the following questions.
Figure 15.2

-Which of the following would cause the change depicted in Figure 15.2? Note that the figure depicts the quantity of euros traded.
A)Australian productivity falls relative to European productivity.
B)Australians decrease their preferences for goods produced in the European Union (E
U)relative to Australian goods.
C)The EU increases its quotas on Italian wine.
D)The price level of goods produced in the EU decreases relative to the price level of goods produced in Australia.

Question

Refer to Figure 15.2 for the following questions.
Figure 15.2
 
-Which of the following would cause the change depicted in Figure 15.2? Note that the figure depicts the quantity of euros traded.
A)Australian productivity falls relative to European productivity. 
B)Australians decrease their preferences for goods produced in the European Union (E
U)relative to Australian goods. 
C)The EU increases its quotas on Italian wine. 
D)The price level of goods produced in the EU decreases relative to the price level of goods produced in Australia.

Quizplus · Accepted Answer

A decrease in Australians' preferences for EU goods would lead to a decrease in the demand for euros, as fewer euros would be needed to purchase EU goods, affecting the quantity of euros traded.

Refer to Figure 15.2 for the Following Questions