If the EU imposes a quota on the importing of clothing produced in China, so reducing UK imports of clothing Which of the following is true regarding the market for foreign currency exchange?
AThe demand for Pounds increases and the pound appreciates
BThe Supply of pounds decreases, and the pound appreciates
CThe Supply of pounds increases, and the pound depreciates
DThe demand for pounds decreases and the pound depreciates
Correct answer
A. The demand for Pounds increases and the pound appreciates
Explanation
The correct answer is The demand for Pounds increases and the pound appreciates.