Disposable income rises in the United States because of a tax cut. What

happens?

a. The demand for imports in the United States rises, leading to an increased

demand for British goods and resulting in appreciation in the British

pound.

b. The demand for imports in the United States rises, leading to an increased

demand for British goods and resulting in depreciation of the British

pound.

c. The demand for exports in Britain rises, leading to an increased demand for

American goods and resulting in appreciation in the dollar.

d. The demand for exports in Britain rises, leading to an increased demand for

American goods and resulting in depreciation of the dollar.