Cambridge International (CAIE) · 6 International economic issues (AS) · 6.4 Exchange rates

Cambridge International (CAIE) Economics past paper questions: Exchange rates

Every Cambridge International (CAIE) question on Exchange rates from 2023 to 2025: 3 essays, 1 data response question and 10 multiple choice questions. It covers 2.1 Demand and supply curves, 1.1 Scarcity, choice and opportunity cost and 2.2 Price elasticity, income elasticity and cross elasticity of demand. Each question links to its paper, mark scheme and examiner report.

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Subtopics2.1 Demand and supply curves 11.1 Scarcity, choice and opportunity cost 12.2 Price elasticity, income elasticity and cross elasticity of demand 1

Essay questions on exchange rates

AS Paper 2, June 2025, Q5(a)OptionalExplain8 marks

With the help of a diagram, explain two ways in which a fall in the balance of trade in goods may affect the value of a floating exchange rate and consider the extent to which a change in the relative rate of interest between two countries may have a greater impact on the exchange rate.

Question paper p.4 Mark scheme p.20 Open in the tool

AS Paper 2, March 2024, Q4(a)OptionalExplain8 marks

Explain what is meant by a depreciation of the exchange rate and consider whether a depreciation is likely to increase domestic real output.

Question paper p.4 Mark scheme p.14 Open in the tool Practise the AD/AS diagram

AS Paper 2, March 2023, Q5(a)OptionalExplain8 marks

With the help of a diagram, explain what is meant by an appreciation of a floating exchange rate and consider whether a country can only benefit from the appreciation of its currency.

Question paper p.4 Mark scheme p.17 Examiner report p.5 Open in the tool Draw it: AD/AS diagram

Data response questions on exchange rates

AS Paper 2, March 2025, Q1(e)Assess6 marks

Case study: A global olive oil shortage

Assess the extent to which a fall in the value of the US dollar against the euro is likely to affect US imports of olive oil from the EU.

Question paper p.3 Mark scheme p.11 Examiner report p.3 Open in the tool

Multiple choice questions

AS Paper 1, June 2025, Q30
The Euro (€) is the main currency of the European Union. The diagram shows the exchange rate between the Euro and the US dollar. What is likely to have caused this change in the value of the Euro?
AS Paper 1, March 2025, Q27
When is a country’s exchange rate most likely to fall?
AS Paper 1, November 2024, Q24
Which circumstances would most help a firm to gain from a depreciation of the exchange rate?
AS Paper 1, November 2024, Q30
The table shows the exchange rate for national currencies per US dollar. Which currency has the smallest percentage appreciation against the US dollar between 2019 and 2020?
AS Paper 1, June 2024, Q29
What will cause an increase in the demand for the US dollar($)?
AS Paper 1, November 2023, Q17
Which term relates to a fall in the domestic real value of a currency?
AS Paper 1, March 2023, Q17
The graphs show the changes in the exchange rates of the pound sterling (£) against the US dollar (US$) and the euro (€) between the years 2001 and 2003.
AS Paper 1, March 2023, Q22
What is most likely to cause a rise in a country’s exchange rate?
AS Paper 1, March 2023, Q23
Which change affecting the foreign exchange market for the US$ would be most likely to result in a shift to the right of the demand curve and a movement along the supply curve?
AS Paper 1, March 2023, Q27
Why might a government prefer to use floating exchange rates?

Question text is quoted from the question papers, © Cambridge University Press & Assessment (UCLES), for students’ private study. Open the official papers and mark schemes from the links on each question. Examiner insights are written with AI assistance and moderated by Finn.

Essay questions on exchange rates

Data response questions on exchange rates

Multiple choice questions

More Cambridge International (CAIE) topics: 6 International economic issues (AS)