Economics Multiple Choice Question – 19 June 2022

Over a given period the nominal value of a country’s national income increased by 20% and its value of output by 25%.

What could explain this?

Select ONE answer:

1. The country’s money supply fell by 5%.
2. There was an increase in the income velocity of circulation.
3. There was an increase in the balance of trade deficit.
4. The country’s general price level fell by 5%.

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Economics KS4 and KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct

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