CUET Economics 2025 21 May Shift 1 PYQs

In modern economies, countries interact through various channels, Which market is not an example of these linkages?

Suppose that government bonds in country A pay 8 per cent rate of interest whereas equally safe bonds in country B yield 10 per cent. The interest rate differential is 2 per cent. Arrange the consequences of the same in sequential order.

(A) People will find investing in country B more attractive and will therefore demand less of country A's currency.

(B) Depreciation of country A's currency and an appreciation of country B's currency.

(C) Investors from country A will be attracted by the high interest rates in country B and will buy the currency of country B selling currency of country A.

(D) The demand curve for country A's currency will shift to the left and the supply curve will shift to the right.

Choose the correct answer from the options given below:

Match the following:

Which of the following combination is a correct match of the above?

1. (A) - (I), (B) - (II), (C) - (IV), (D) - (III)
2. (A) - (I), (B) - (II), (C) - (III), (D) - (IV)
3. (A) - (II), (B) - (III), (C) - (IV), (D) - (I)
4. (A) - (III), (B) - (IV), (C) - (I), (D) - (II)