Circle the correct option in each of the following statements - Leaving Cert Business - Question 6 - 2020
Question 6
Circle the correct option in each of the following statements.
(i) Inflation refers to an increase / a decrease in the general level of prices from one year to the ... show full transcript
Worked Solution & Example Answer:Circle the correct option in each of the following statements - Leaving Cert Business - Question 6 - 2020
Step 1
(i) Inflation refers to an increase / a decrease in the general level of prices from one year to the next.
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Answer
Inflation refers to an increase in the general level of prices from one year to the next. This indicates a decrease in the purchasing power of money.
Step 2
(ii) A rise in the employment rate results in an increase / a decrease in income tax received by the government.
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Answer
A rise in the employment rate results in an increase in income tax received by the government, as more individuals are earning incomes and paying taxes.
Step 3
(iii) Lower interest rates mean the cost of borrowing is cheaper / more expensive.
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Lower interest rates mean the cost of borrowing is cheaper, making loans more affordable for individuals and businesses.
Step 4
(iv) If the euro (€) increases in value relative to the US Dollar ($), Irish products become cheaper / more expensive in the USA.
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Answer
If the euro (€) increases in value relative to the US Dollar ($), Irish products become more expensive in the USA, as it would take more dollars to purchase the same product.
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