Question

If the British pound depreciates against the U.S.​ dollar,

Answer 1

Answer: The correct answer is D: British consumers lose by an increase in the pound price of U.S. exports to Britain.

Explanation:

If the price of U.S. exports to Britain increases, consumer's purchasing power is affected. The price of the products increases considerably and the consumers are unable to buy as they want. Indeed, import taxes increase as well, affecting even more customers' economic capacity. The depreciation of the local currency against the U.S. dollar is a serious problem that affects the economic development of a country.