DP Economics Questionbank

Define the term depreciation indicated in bold in the text (paragraph [6]).

Using an exchange rate diagram, explain how the central bank might depreciate the value of the rupee (paragraph [3]).

Calculate the quantity of EU€ she will receive for her US$300 000.

Calculate, in US$, the loss made by Tanya as a result of these transactions.

Using an exchange rate diagram, explain one reason for the appreciation of the Canadian dollar (paragraph [3]).

Define the term depreciation indicated in bold in the text (paragraph [3]).

Using an AD/AS diagram, explain how Turkey’s reliance on energy imports is putting “further pressure on inflation” (paragraph [4]).

Using an exchange rate diagram, explain what is likely to have happened to the Turkish lira when Turkish citizens “bought US$1 billion worth of foreign currency” (paragraph [5]).

If a visitor to Gardia from the US buys a towel that costs 23 gamma, calculate the cost in US$.

Calculate the additional cost of paying back the loan in gamma in 2019, due to the interest and the change in the exchange rate.

Calculate the equilibrium exchange rate for the US$ in terms of the gamma.

Plot and label the new supply curve on Figure 2.

Using Figure 2, calculate how many US$ are needed to buy one gamma at the new exchange rate.

Calculate the value of the Mexican peso (US$ per MX$) in 2015. Enter your result in Table 3.

Using information from Figure 5, sketch an exchange rate diagram to show how the change in Mexico’s spending on imports in 2010 would have affected its exchange rate (US$ per MX$), ceteris paribus.

Define the term depreciation indicated in bold in the text (paragraph [4]).

Using an exchange rate diagram, explain how a decrease in the interest rate might influence the value of the Thai baht (paragraph [6]).

Using an exchange rate diagram, explain how the fall in export revenue contributed to the depreciation of the leone (Text D, paragraph [4]).

Using an exchange rate diagram, explain how a reduction in the current account deficit could affect the exchange rate for the kwacha (Text D, paragraph [5]).

Using an exchange rate diagram, explain how “the need to import corn” will affect the value of the South African rand (paragraph [3]).

Using an exchange rate diagram, explain how the central bank might depreciate the value of the rupee (paragraph [3]).

Using an exchange rate diagram, explain one reason for the appreciation of the Canadian dollar (paragraph [3]).

State two reasons that could have caused an increase in the supply of US$.

Using Table 3, state one possible effect on Mexican consumers and one possible effect on Mexican producers from the change in the value of the Mexican peso (US$ per MX$) between 2014 and 2016.

Using an exchange rate diagram, explain how raising interest rates would “stop the fall in the peso’s value” (paragraph [4]).

Using an exchange rate diagram, explain how higher interest rates could “protect the rupee from further depreciation” (paragraph [5]).

Using an exchange rate diagram, explain why the “widening trade deficit in services” could lead to a depreciation of the renminbi (paragraph [3]).

Using a foreign exchange diagram, explain the possible effect of China’s large current account surplus in 2007 on the exchange rate of China’s currency (the renminbi) (paragraph [6]).

Using an exchange rate diagram, explain the effect on the South Korean won’s exchange rate of South Korea’s central bank selling US dollars (paragraph [6]).

Using an exchange rate diagram, explain how a decrease in the interest rate might influence the value of the Thai baht (paragraph [6]).

Using an exchange rate diagram, explain how a reduction in the current account deficit could affect the exchange rate for the kwacha (Text D, paragraph [5]).

Explain two possible economic consequences for the eurozone if the euro appreciates.

Using information from the text/data and your knowledge of economics, discuss the possible effects on the Canadian economy of the strengthening of the Canadian dollar against the US dollar.

Using an AD/AS diagram, explain how the peso’s weakness is “raising inflation” (paragraph [6]).

Using information from the text/data and your knowledge of economics, discuss the possible economic consequences on the Indian economy of a depreciating rupee.

Using information from the text/data and your knowledge of economics, discuss the view that a depreciating currency is good for the Chinese economy.

Using information from the text/data and your knowledge of economics, evaluate the South Korean central bank’s decision to intervene in order to prevent the South Korean won from depreciating again.

Using information from the text/data and your knowledge of economics, evaluate the implications of the strong Thai baht on Thailand’s economy.

Using real-world examples, discuss the consequences of a fall in a country’s exchange rate.

Define the term fixed exchange rate indicated in bold in the text (paragraph [1]).

Using an exchange rate diagram, explain how the central bank of North Macedonia is preventing an appreciation of the denar against the euro (Text B, paragraph [4]).

Using an exchange rate diagram, explain how the central bank in Vietnam could prevent the dong from depreciating by using its reserve assets (Text C, paragraph [2]).

Explain two reasons why a government might prefer a floating exchange rate system for its currency.