Consider the currency market for British pounds and U.S. dollars. An increase in the demand for British pounds results in

A) an appreciation of the pound and a depreciation of the dollar.
B) a depreciation of the pound and a depreciation of the dollar.
C) an appreciation of the pound and an appreciation of the dollar.
D) a depreciation of the pound and an appreciation of the dollar.

Demand for British Pounds

The desire or need by individuals, businesses, or countries to purchase or hold British currency for the purpose of investment or transactions.

Currency Market

A global market where currencies are traded against each other, determining their exchange rates.

Appreciation

An increase in the value of an asset over time, which can be influenced by factors like demand, inflation, and currency value changes.