A-LevelEconomicsThe macroeconomy9708/12 · Oct/Nov 2014 · Q281 Mark

Which economic change might contribute to both cost-push and demand-pull inflation?

Afall in the exchange rate

Bfall in the interest rate

Crise in the productivity of industrial workers

Dan improvement in the terms of trade

✓ Correct answer

A: fall in the exchange rate

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Topic: The macroeconomy, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source: A-Level Economics, Oct/Nov 2014 Paper 1 Variant 2, question 28.

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