Post Utme Eksu 2024 Economics Question 29

Practice objective / multiple choice question 29 from the 2024 Post Utme Eksu Economics examination.

Post Utme Eksu 2024 Economics Objective / Multiple Choice
Question 29 POST_UTME_EKSU • 2024 • ECONOMICS • objective

A country is experiencing an inflation rate of 5% per annum. U\sing the concept of purcha\sing power parity, explain why the country's currency may appreciate against other currencies.

Answer Options

A. The country's inflation rate is lower than the inflation rate of other countries, leading to a decrease in the value of the currency.
Correct Answer B. The country's interest rate is higher than the interest rate of other countries, leading to an increase in the value of the currency.
C. The country's currency is overvalued, leading to a decrease in the value of the currency.
D. The country's currency is undervalued, leading to an increase in the value of the currency.
Correct Answer
B
Correct Option:
The country's interest rate is higher than the interest rate of other countries, leading to an increase in the value of the currency.

About This Question

This is Post Utme Eksu 2024 Economics Question 29. It is one of the objective questions from the 2024 Post Utme Eksu Economics examination.

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