Consider the currency market for British pounds and U.S. dollars. An increase in the demand for British pounds results in:

Question

Quizplus · Accepted Answer

An increase in demand for a currency leads to an increase in its value, which in this case would lead to an appreciation of the British pound. As the demand for pounds increases, there is also a decrease in demand for dollars, leading to a depreciation of the dollar. Thus, Choice A is the correct one.

Consider the Currency Market for British Pounds and U