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6. In the UK, the base interest rate is set by...
- Chief secretary to the treasury
- Monetary Policy Commitee
- The chancellor of the exchequer
- The house of commons
7. Which of the following affect the demand for the pound on the foreign exchange market?
- UK speculator buying shares on the New York Stock Exchange
- UK tourists going on holiday
- Boeing (US aircraft manufacturer) buying engines from Rolls-Royce in the UK
- ICI (a UK firm) buying raw materials from overseas
8. What is meant by a fixed interest rate?
- Interest rates will only change if the prime minister says they must
- An interest rate which will not change at whatsoever over the life of a loan
- A tax paid by tradesmen
- An interest rate which can flucuate
9. Interest rates are most likely to be cut when the economy is:
- Entering a recession
- Experiencing much lower employment
- Enjoying a boom
- Experiencing high inflation
10. What is an exchange rate?
- The price of buying foreign currency
- The rate you pay back on a loan
- A tax you pay when buying goods whilst abroad
- A tax businesses pay to operate in another country