Economics 9708 · AS & A Level · 6.5

6.5 — practice question

An economy is experiencing a high inflation rate and a balance of payments deficit. Which policy change would help reduce the balance of payments deficit without worsening inflation?

  • Aa devaluation of the currency
  • Ba reduction in government spending
  • Cthe imposition of import quotas
  • Dthe removal of import tariffs

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