Question 1: 5 points 1) Assume inflation goes up in Argentina and remains unchanged in the US. a) Will the demand for USD go up or down? Why? Answer: The demand for USD would go up in consideration of Argentina. This is because with inflation going up in Argentina, there will be more demand for the USD from exchanging currency and buying goods. b) Will the supply of ARS go up or down? Why? Answer: The supply for ARS will go up because there is demand for it due to inflation. People will need to exchange their currency for SSD 2) Assume the UK lowers income tax rates. Nothing changes in the US. a) Will the demand for GBP change? How? Answer: It will remain the same if the UK lowers income tax rates the demand for GBP. This is because of the lower income tax rate, that will cause an increase in foreign buyers and citizens buying as well since prices are lower. b) Will the supply of GBP change? How? c) Will the supply of USD change? How