A-LevelEconomicsExchange RatesMay/June 2015Paper 1 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?

Q: What topic does this question test?

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

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

The correct answer is D: the development of UK substitutes for US goods

📋 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 Exchange Rates in A-Level Economics (syllabus code 9708). It is worth 1 mark.

Source

This question appeared in the Cambridge A-Level Economics May/June 2015 examination, Paper 1 Variant 2.

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