The exchange rate of a country's currency has appreciated. All other things being equal, which one of the following is most likely to occur as a result of this?
A rise in aggregate demand and an improvement in the balance of payments on current account
A fall in aggregate demand and a decrease in the rate of inflation
A rise in aggregate demand and an increase in employment
A fall in aggregate demand and an improvement in the balance of payments on current account
310 exam-style questions on AQA A Level Economics 2.6 The international economy (A-level only), covering 2.6.1 Globalisation, 2.6.2 Trade, 2.6.3 The balance of payments, 2.6.4 Exchange rate systems, and 2.6.5 Economic growth and development. Each one has a worked solution and a mark scheme showing where the marks go.