All other things being equal, which one of the following combinations, A, B, C or D, is most likely to lead to an improvement (or a reduction in the deficit) in a nation's balance of payments on current account?
| Combination | Domestic inflation rate relative to trading partners | Real GDP growth rate of major trading partners | External value of the domestic currency |
|---|---|---|---|
| A | Increase | Increase | Decrease |
| B | Decrease | Decrease | Increase |
| C | Decrease | Increase | Decrease |
| D | Increase | Decrease | Increase |
Combination A
Combination B
Combination C
Combination D
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.