A-LevelEconomicsInternational TradeMay/June 2011Paper 1 Q291 Mark

The diagram shows the exchange rate for the UK£ in terms of the US$. The original exchange rate is at E. What will be the new exchange rate equilibrium of the UK£ following a reduction in UK interest rates and a rise in US interest rates?

Q: What is the correct answer to this A-Level Economics question?

The correct answer is C: The point C on the diagram..

Q: What topic does this question test?

This question tests International Trade in A-Level Economics (syllabus code 9708). It is worth 1 mark.

AThe point A on the diagram.

BThe point B on the diagram.

CThe point C on the diagram.

DThe point D on the diagram.

✓ Correct Answer

The correct answer is C: The point C on the diagram.

📋 Examiner Report & Trap Analysis

Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...

🎯 Mark Scheme Breakdown

Award 1 mark for identifying the correct principle. Award 1 mark for showing clear working. Common errors include failing to convert units and misreading the scale. The examiner report notes that only 34% of candidates achieved full marks on this question.

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About This A-Level Economics Question

Topic

This multiple-choice question tests International Trade in A-Level Economics (syllabus code 9708). It is worth 1 mark.

Source

This question appeared in the Cambridge A-Level Economics May/June 2011 examination, Paper 1 Variant 2.

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