Exchange rates

Evaluate macroeconomic policies that could be used to reduce a current account deficit. Refer to a country of your choice in your answer.

Case study · The food delivery industry

Evaluate the microeconomic and macroeconomic effects of a depreciation of the pound. Refer to restaurants or other food delivery services in your answer.

The British pound fell by over 10% to a 30-year low against the US dollar after the UK voted to leave the European Union. To what extent will this depreciation impact on future economic growth in the UK?

Case study · Ghana – cocoa and chocolate production

Explain one reason why a country might operate a managed exchange rate. Refer to Extract D in your answer.

Case study · Turkey – an emerging economy

Explain how the Turkish central bank intervenes in the currency market to prevent ‘excessive appreciation or depreciation of the Turkish lira’ (Extract A, lines 7–8).

Case study · Turkey – an emerging economy

Examine two reasons why the Turkish government may want to avoid a significant fall in the exchange rate of the Turkish lira.

Case study · The UK economy since the financial crisis

With reference to Extract A and Figure 1, examine the likely impact of the change in the sterling exchange rate on the UK economy.

Case study · The Eurozone economy

With reference to Figure 1, calculate the percentage change in the value of the euro in pounds from the start of 2009 to the start of 2015.

Case study · The Eurozone economy

Since mid-2015 the euro has appreciated. Assess the likely impact of an appreciation of the euro on the current account of the balance of payments for Eurozone countries.

Case study · Chile

With reference to Figure 2, explain one likely reason for the change in the Chile peso exchange rate between 2013 and 2015.

With reference to the chart on the previous page, explain one likely reason for the change in the UK current account deficit from 2016 to 2021.

Explain the likely impact of the change in the exchange rate of the pound shown in the graph from 1st January 2018 to 1st January 2019 on the UK current account of the balance of payments.

Which one of the following has been the overall change in the British pound to US dollar exchange rate from 1st January 2018 to 1st January 2019?

Which one of the following is most likely to happen to Argentina’s currency value as a result of capital flight, assuming it is operating with a floating exchange rate system?