The United Kingdom currently has a trade deficit with New Zealand. If the U.K. pound sterling appreciates relative to the New Zealand dollar, which of the following correctly explains the effect on the U.K.'s demand for goods from New Zealand?(1 point)

Question

Responses

The U.K.'s demand for New Zealand goods will decline.
The U.K.'s demand for New Zealand goods will decline.

The U.K.'s demand for New Zealand goods can't be determined.
The U.K.'s demand for New Zealand goods can't be determined.

The U.K.'s demand for New Zealand goods will rise.
The U.K.'s demand for New Zealand goods will rise.

The U.K.'s demand will remain the same.
The U.K.'s demand will remain the same.
2.If the area between the 45-degree line and the Lorenz curve has increased, this means that(1 point)
Responses

income inequality has increased.
income inequality has increased.

labor mobility has decreased.
labor mobility has decreased.

labor mobility has increased.
labor mobility has increased.

income inequality has decreased.

Answer 1

1. If the U.K. pound sterling appreciates relative to the New Zealand dollar, the U.K.'s demand for goods from New Zealand will decline. This is because an appreciating pound means that New Zealand goods become more expensive for U.K. consumers, leading to a decrease in demand for those goods.

Correct response: The U.K.'s demand for New Zealand goods will decline.

2. If the area between the 45-degree line and the Lorenz curve has increased, this means that income inequality has increased. The Lorenz curve represents the distribution of income, and a larger area between the curve and the 45-degree line indicates a greater disparity in income distribution.

Correct response: income inequality has increased.