Note AcademyNote Academy
Start

Economics (AS & A Level) · May / June 2022 · Paper 14 · Question 25

9708Exchange rates

The currency of country X has a floating exchange rate against other currencies. Under which circumstances will the value of country X's currency fluctuate the most against other currencies on the foreign exchange market?

  1. Aprice elasticity of demand: elastic; price elasticity of supply: elastic
  2. Bprice elasticity of demand: inelastic; price elasticity of supply: elastic
  3. Cprice elasticity of demand: elastic; price elasticity of supply: inelastic
  4. Dprice elasticity of demand: inelastic; price elasticity of supply: inelastic

As printed in the paper

Show the answer

Correct answer: D. price elasticity of demand: inelastic; price elasticity of supply: inelastic

Sit this whole paper →More on Exchange rates

Make a free account to save your answers and see your weak topics and ask the AI why a wrong answer is wrong.