A-LevelEconomicsInternational economic issues9708/12 · Feb/Mar 2020 · Q281 Mark

A country with a fixed exchange rate and a deficit in the current account of its balance of payments enters a recession. It devalues its currency in an effort to correct its balance of payments. Under which conditions is the deficit most likely to improve?

A0.3, 0.5, 0.8

B0.4, 0.8, 0.8

C0.3, 0.5, 1.2

D0.4, 0.8, 1.2

✓ Correct answer

D: 0.4, 0.8, 1.2

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Topic: International economic issues, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source: A-Level Economics, Feb/Mar 2020 Paper 1 Variant 2, question 28.

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