A-LevelEconomicsExchange RatesMay/June 2017Paper 1 Q231 Mark
Country X conducts 60% of its trade with country Y and 40% of its trade with country Z. The initial value of the trade weighted exchange rate index of country X is 100. What will be its new trade weighted exchange rate index value if its currency rises in value by 20% against the currency of Y and falls by 10% against the currency of Z?
A84
B92
C108
D116
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of exchange rates within the Economicssyllabus. The examiner's mark scheme requires...
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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...
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