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Exchange rates

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Question 11

The diagram shows the exchange rate of US Dollars ($) to British Pounds (£\pounds£).

Exchange rate diagram showing demand shifting from D to D1

What may have caused the demand curve for US Dollars to shift from D D\,D to D1D_1D1​?

An increase in US interest rates relative to UK interest rates

A decrease in UK demand for US exports

An increase in US demand for UK imports

A decrease in the rate of inflation in the UK relative to the US

Exchange rates Questions

  1. A Level
  2. /Economics
  3. /Exchange rates