Use the following graph, which shows the supply and demand for British pounds, to answer the next question.
D1 and S1 represent the initial demand and supply curves. If there is a huge increase in the desire of U.S. buyers to consume British products, and the British government starts buying U.S. dollars in order to fix the exchange rate at the initial level, then the new equilibrium will be found at ________.
A. Point H
B. Point C
C. Point F
D. Point J
Answer: A
Economics
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