The impact of exchange rates

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1. What is an effect of the fall in the value of pound?

  • Fall in export sales
  • Leads to increased costs if imports are of raw material used in production
  • Rise in exchange rate
  • Foreign buyers give up more euro to get the same amount of pounds
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2. What does export lead to?

  • Increase in interest rates
  • Money flowing into UK
  • Import to UK likely to decrease
  • Money flowing out UK

3. What is an effect of the rise in the value of pound?

  • UK companies buying from abroad will find prices cheaper.
  • Qualities such as leadership are shown by entrepreneurs
  • Export sales rise
  • Decrease import to UK

4. What does import mean?

  • Increase in level of economic activity
  • What businesses and customers buy from abroad
  • Percentage reward to savers
  • What businesses sell abroad

5. 'how much money has to be given up of one currency to buy another currency' is the definition of...

  • Stakeholder
  • Interest rates
  • Exchange rates
  • Recession


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