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HOME > Sample Questions > Economics Module > Analysing Economic Interrelationships > Example 3

Analysing Economic Interrelationships - Example 3

Instructions    Example 1    Example 2    Example 3    Example 4    Example 5    Example 6

The illustration shows the development of the US Dollar / Euro exchange rate from the beginning of April 2004 to the beginning of April 2005. It shows how many US Dollars one Euro was worth. The value of the dollar in Euros can easily be calculated.

Development of the US Dollar / Euro Exchange Rate

Which of the following statements is / are correct?

I. The value of the Euro (in US Dollars) increased by ten percent from April to the end of October 2004.
II. Anyone who exchanged 1,000 Euros for dollars at the end of November 2004 received more than 1,000 Euros when re-exchanging the money at the end of March 2005.

(B) Only statement II is correct.
(C) Both statements are correct.
(D) Neither of the two statements is correct.

Degree of difficulty: medium

Solution

Instructions    Example 1    Example 2    Example 3    Example 4    Example 5    Example 6