Economics 9708 · AS & A Level · 6.4

6.4 — practice question

After the US$ had been depreciating for a long period, the monetary authorities in both the US and the UK increased their domestic interest rates. What would happen to the exchange rate value of the US$ in terms of UK£?

  • AIt will remain unchanged.
  • BIt will fall.
  • CIt will rise.
  • DThe outcome is uncertain.

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