If the Bank of England reduces the money supply to reduce inflation a floating exchange rate will aid the Bank of England in fighting inflation because ?

A. as the money supply is decreased the interest rate will increase and the price of UK exports will rise and the Price of UK imports will fall

B. as the money supply is decreased the interest rate will increase, and the price of UK exports will fall and the price of UK imports will rise

C. as the money supply is decreased the interest rate will increase and the price of UK exports and UK imports will fall.

D. as the money supply is decreased the interest rate will increase and the price of both UK exports and UK imports will rise

Found an error? Read our corrections policy and submit a sourced correction below. You can also share a useful explanation in your own words.

Discuss the answer or suggest a sourced correction
Thank you for contributing.
Your comment was submitted and will appear after editorial review.

Your email is used only for moderation and is never displayed. Spam, copied material and fabricated endorsements are rejected.