A-LevelEconomicsInternational economic issues9708/12 · May/June 2014 · Q281 Mark

What determines the purchasing power parity of a currency?

Arelative costs of living

Brelative rates of interest

Cthe balance of payments current account

Dthe volume of trade creation

✓ Correct answer

A: relative costs of living

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Topic: International economic issues, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source: A-Level Economics, May/June 2014 Paper 1 Variant 2, question 28.

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