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O-LevelEconomicsGovernment and the macroeconomy2281/11 · May/June 2021 · Q201 Mark

What will deflation most likely lead to?

Afall in the real value of debts
Ban increase in the exchange rate
Can increase in the rate of interest
Dan increase in the real purchasing power of money

✓ Correct answer

D: an increase in the real purchasing power of money

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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 2021 Paper 1 Variant 1, question 20.

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