In the market for British pounds, if the current exchange rate is above the equilibrium rate,
a. there is an excess supply of pounds and those who hold pounds will be able to sell them and make a profit
b. there is an excess supply of pounds and the exchange rate will fall
c. there is an excess demand for pounds and suppliers will not be able to supply enough pounds to meet the demand
d. there is an excess demand for pounds and the exchange rate will rise
e. the quantity of pounds supplied is barely sufficient to meet the quantity demanded
B
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In Figure 3-7 above, if the natural real GDP is $2500, AP = $250, and the change in "a" = change in I = change in NX = 0, then the natural real GDP could be attained with a
A) $250 decrease in T. B) $250 increase in G. C) $1250 increase in G. D) $500 decrease in T.
Answer the following statements true (T) or false (F)
1) Strong economic growth since 1960 has allowed nations like Singapore and Ireland to surpass nations such as the United Kingdom and France in real GDP per capita. 2) Strong property rights inhibit economic growth by strictly regulating economic behavior. 3) Strong patent laws encourage innovation and promote economic growth. 4) The intense competition of free trade prevents the investment that generates economic growth. 5) A competitive market system promotes growth by providing producers with market signals on which to base investment and production decisions.