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O-LevelEconomicsGovernment and the macroeconomy2281/13 · Oct/Nov 2025 · Q241 Mark

A country's Consumer Prices Index (CPI) falls from 120 to 110 in a year. What will be a likely effect of this fall?

Aincomes will fall in real terms
Bsavings will fall in real terms
Cthe rate of interest will rise
Dthe real value of debt will rise

✓ Correct answer

D: the real value of debt will rise

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About this question

Topic
Government and the macroeconomy, O-Level Economics (syllabus 2281). Multiple choice, 1 mark.
Source
O-Level Economics, Oct/Nov 2025 Paper 1 Variant 3, question 24.

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