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Economics (AS & A Level) · May / June 2026 · Paper 13 · Question 30

9708Exchange rates

What is the consequence of an appreciation of the exchange rate on the current account of the balance of payments and the price level?

  1. Acurrent account of the balance of payments: improves; price level: decreases
  2. Bcurrent account of the balance of payments: improves; price level: increases
  3. Ccurrent account of the balance of payments: worsens; price level: decreases
  4. Dcurrent account of the balance of payments: worsens; price level: increases

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Correct answer: C. current account of the balance of payments: worsens; price level: decreases

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