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2.6 The international economy (A-level only)

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Question 6

An economy is experiencing a persistent deficit on the current account of its balance of payments. Which one of the following combinations of economic circumstances is most likely to lead to a reduction in this current account deficit?

Output gapExchange rate of the domestic currencyDomestic inflation relative to competitor nations
ANegativeAppreciatingRising
BPositiveAppreciatingRising
CNegativeDepreciatingFalling
DPositiveDepreciatingFalling
A

Negative output gap, Appreciating exchange rate, Rising domestic inflation

B

Positive output gap, Appreciating exchange rate, Rising domestic inflation

C

Negative output gap, Depreciating exchange rate, Falling domestic inflation

D

Positive output gap, Depreciating exchange rate, Falling domestic inflation

Markscheme

2.6 The international economy (A-level only) Questions

  1. A Level
  2. /Economics
  3. /2.6 The international economy (A-level only)

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.

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