A-LevelEconomicsInternational economic issues9708/12 · May/June 2015 · Q291 Mark

In the diagram, curves D₁ and S relate to the demand for and supply of £ sterling in the foreign exchange market. [Figure 29.1] What may cause the demand curve to shift from D₁ to D2?

This question uses a diagram from the original paper, which isn't shown here. Open the full paper from the past papers archive to see it.

Adecrease in UK interest rates

Bdecrease in the price of US goods sold in the UK

Cthe removal of UK tariffs against US goods

Dthe development of UK substitutes for US goods

✓ Correct answer

D: the development of UK substitutes for US goods

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Topic: International economic issues, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source: A-Level Economics, May/June 2015 Paper 1 Variant 2, question 29.

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