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Economics (AS & A Level) · Oct / Nov 2024 · Paper 33 · Question 26

9708Policies to correct disequilibrium in the balance of payments

A government wants to reduce the current account deficit on the balance of payments. What is an example of an expenditure-reducing policy?

  1. Aa devaluation of the currency
  2. Ba subsidy on domestic production
  3. Ca tariff on imports
  4. Dan increase in income taxes

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Correct answer: D. an increase in income taxes

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