Final answer:
The GBP rising in value relative to the USD means an investor can exchange their GBP for more USD, increasing their purchasing power in the US.
Step-by-step explanation:
In this scenario, the international investor is hoping for the British pound (GBP) to appreciate in value relative to the US dollar (USD). When the exchange rate between two currencies rises, it means that one unit of the first currency can buy more units of the second currency. So, if the GBP rises in value from $1.50 to $1.60, it means that in the future, the investor will be able to get more USD for each GBP.
To put it in perspective, suppose the investor initially exchanges 100 GBP when the exchange rate is $1.50. They would receive 100 x $1.50 = $150 in USD. However, if the GBP rises in value to $1.60, the same 100 GBP would be worth 100 x $1.60 = $160 in USD. This increases the investor's purchasing power in the US.
Overall, the investor hopes that the GBP will appreciate in value to increase their returns when exchanging the currency.