A-LevelEconomicsGovernment Macroeconomic InterventionMay/June 2019Paper 1 Q281 Mark
A country with a balance of trade deficit raises interest rates. How may this help to reduce the deficit in the short run?
Aby increasing the inflow of foreign direct investment
Bby lowering the foreign exchange rate
Cby raising the level of domestic capital investment
Dby reducing the level of domestic aggregate demand
✓ Correct Answer
The correct answer is D. This question tests the candidate's understanding of government macroeconomic intervention 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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