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O-LevelEconomicsGovernment and the macroeconomy2281/12 · May/June 2019 · Q201 Mark

The table shows possible sequences between the rate of interest and other economic variables. Which sequence is the most likely?

Ainterest rate: higher, borrowing: decrease, investment: increase, GDP: increase
Binterest rate: higher, borrowing: increase, investment: decrease, GDP: decrease
Cinterest rate: lower, borrowing: decrease, investment: decrease, GDP: decrease
Dinterest rate: lower, borrowing: increase, investment: increase, GDP: increase

✓ Correct answer

D: interest rate: lower, borrowing: increase, investment: increase, GDP: increase

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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, May/June 2019 Paper 1 Variant 2, question 20.

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