O-LevelEconomicsInternational trade and globalisation2281/12 · Oct/Nov 2014 · Q281 Mark

When the US$ exchange rate falls it will usually

Ahelp to reduce a US trade deficit.

Bincrease the foreign price of US exports.

Creduce the price of US imports.

Dreduce US inflation.

✓ Correct answer

A: help to reduce a US trade deficit.

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Topic: International trade and globalisation, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source: O-Level Economics, Oct/Nov 2014 Paper 1 Variant 2, question 28.

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