Refer to the Above Diagram

Refer to the above diagram.Assume the initial demand for,and supply of,dollars is shown by D₁ and S₁.Now suppose that the United Kingdom increases its imports of Canadian goods,shifting the demand for dollars curve from D₁ to D₂.Assuming a freely floating exchange rate,

A) the exchange rate will appreciate to ≤0.50 per dollar.
B) the exchange rate will appreciate to ≤0.40 per dollar.
C) the exchange rate will not change.
D) a dollar shortage of MN will result in the UK.
E) the exchange rate will appreciate to ≤0.60 per dollar.