The shape of supply curve of foreign exchange is :
(
This question was previously asked in
Shift 11/06/2023 3:30 PM - 6:30 PM
A
A horizontal line parallel to x-axis
B
A vertical line parallel to y-axis
C
An upward sloping line
D
A downward sloping line
Correct Answer
An upward sloping line
Detailed Explanation
The shape of the supply curve of foreign exchange is typically an upward-sloping line. So, the correct option is:
(3) An upward-sloping line.
The supply of foreign exchange usually increases as the exchange rate (price of the foreign currency) rises, indicating that more foreign currency is supplied in the market at higher exchange rates. This reflects the law of supply in economics.
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