Economics 9708 · AS & A Level · 6.4

6.4 — practice question

A country sees shifts in the value of its exports and imports of goods and services, together with its inflow of incomes and transfers. The table shows these changes. Which combination of changes is most likely to lead to a depreciation in its floating exchange rate?

  • Aexport value: fall; import value: fall; net inflow of incomes and transfers: fall
  • Bexport value: fall; import value: rise; net inflow of incomes and transfers: fall
  • Cexport value: rise; import value: fall; net inflow of incomes and transfers: rise
  • Dexport value: rise; import value: rise; net inflow of incomes and transfers: rise

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