A-LevelEconomicsInternational Trade and FinanceMay/June 2019Paper 1 Q271 Mark
Under a system of floating exchange rates, what determines the foreign exchange value of a currency?
Athe overall supply of and demand for a currency on currency markets
Bthe purchasing power of the currency relative to the purchasing power of foreign currencies
Cthe surplus or deficit on the balance of payments on current account
Dthe differential between domestic and foreign interest rates
✓ Correct Answer
The correct answer is A. This question tests the candidate's understanding of international trade and finance within the Economicssyllabus. The examiner's mark scheme requires...
📋 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...
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