Economics 9708 · AS & A Level · 6.4

6.4 — practice question

What change in the foreign exchange market for the US$ would be most likely to cause the demand curve to shift to the right and result in movement along the supply curve?

  • AThe US government reduces subsidies on exports to the EU.
  • BForeign currency speculators in Switzerland believe that the US$ is undervalued and act accordingly.
  • CThe US government intervenes in the foreign exchange market so as to bring about a drop in the value of the US$.
  • DUS pharmaceutical companies experience a fall in demand for their products from the rest of the world.

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