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Edexcel IGCSE Economics 2.2.3 B Factors Affecting Supply and Demand of Currencies Questions

Practise currency-diagram questions by shifting supply or demand for pounds and labelling new exchange rates and quantities.

Syllabus
First assessment 2019
Course
Economics 4EC1

Exam points

  • Shift demand for pounds after higher exports, interest rates or expected currency gains.
  • Shift supply of pounds after import changes and label the new rate and quantity.
  • Distinguish currency speculators from other financial actors in MCQ items.

Edexcel IGCSE Economics 2.2.3 B Factors Affecting Supply and Demand of Currencies Questions question 1

[Maximum number: 3]

Figure 3 shows the supply of and demand for UK pounds ( £ ) and the equilibrium exchange rate against the US dollar ($).

Using the diagram below, draw the likely effect of a decrease in imports from the US on the equilibrium exchange rate of the UK pound ( £ ) against the US dollar ($). Label the new curve, the new equilibrium exchange rate and the new equilibrium quantity.

Figure 3

Figure 3

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