Post Utme Ims U 2022 Economics Question 12

Practice objective / multiple choice question 12 from the 2022 Post Utme Ims U Economics examination.

Post Utme Ims U 2022 Economics Objective / Multiple Choice
Question 12 POST_UTME_IMS_U • 2022 • ECONOMICS • objective

A country's balance of payments is in surplus, indicating that it is exporting more goods and services than it is importing. U\sing the concept of the balance of payments, explain why this may lead to an appreciation of the country's currency.

Answer Options

Correct Answer A. The surplus in the balance of payments leads to an increase in the demand for the country's currency, cau\sing its value to appreciate.
B. The surplus in the balance of payments leads to a decrease in the supply of the country's currency, cau\sing its value to appreciate.
C. The surplus in the balance of payments leads to an increase in the country's foreign exchange reserves, cau\sing its currency to appreciate.
D. The surplus in the balance of payments leads to a decrease in the country's foreign exchange reserves, cau\sing its currency to depreciate.
Correct Answer
A
Correct Option:
The surplus in the balance of payments leads to an increase in the demand for the country's currency, cau\sing its value to appreciate.

About This Question

This is Post Utme Ims U 2022 Economics Question 12. It is one of the objective questions from the 2022 Post Utme Ims U Economics examination.

View More Post Utme Ims U 2022 Economics Questions More Post Utme Ims U Practice Questions Back to Questions

Master the Exam!

You've seen a preview, but there are thousands more questions plus AI tutor to break down complex solutions.

Unlock Full Access Available for Android & Windows
Chat with Support