The Student Room Group

A level econ multiple choice help

The diagram below shows the demand and supply of pounds. A government is
determined to keep its foreign exchange rate between P1 and P2 and the supply of
pounds has shifted from S1 to S2.

See image below
https://docs.google.com/document/d/1qneSpMJUn7Y-qtvn5kpJO7Zdc2nmeWS_EgO667UNZDE/edit?tab=t.0

To keep the exchange rate within the agreed range, the monetary authorities
will have to: [1]
ANSWER
Tick one box only
A Buy UV pounds
B Sell XW pounds
C Buy ZY pounds
D Sell UV pounds
E Sell ZY pounds

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