2025HSCShort answer

Q22 (a)

2 marks

Question

Use the following graph to answer parts (a) and (b).
Outline ONE global factor that could cause the movement from D to D1 in the graph.

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Solution

Criteria	Marks
Outlines ONE global factor that could cause the exchange rate movement shown	2
Provides some relevant information	1

Sample answer:

One global factor could be the differential between Australian and global interest rates. If global interest rates rise above Australian rates, there will be a decrease in demand D to D₁ for Australian dollars for investment. This causes the currency to depreciate.

Answers could include:

Overseas interest rates rise
Commodity prices
International tastes and preferences change
Changing global economic conditions
Change in demand for exports.

Supplied marking guidance · human reviewed

Compare this with your working, not only your final sentence.

Syllabus alignment

Australia’s Place in the Global Economy

Trade and financeInvestigate Australia’s trade, balance of payments, exchange rates and external stability.

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