Katie Anthony, an 18-year-old from Stratford-upon-Avon Grammar School for Girls, is patiently explaining to the Bank of England experts why interest rates should be held at 5.75 per cent.

“On a consumer level, nearly half of all credit card applications have been turned down in the last six months and, even if you do succeed, you will have to pay a higher rate of interest.

“Due to the fact it’s harder to come by consumer credit, consumption is decreased and therefore there’s a deflationary pressure.”

With A-level exams around the corner and university applications in full swing, sixth-formers have enough on their plates without having to worry about global financial turmoil and the country’s economic stability. Yet around the country hundreds of school teams have been vying against each other in the regional heats of the Bank of England/Times Target 2.0 competition.

The participants mirror the Bank’s Monetary Policy Committee by poring over data and deciding on an interest rate to achieve the target inflation rate of 2 per cent. Then they present their findings and are subjected to questions from the Bank’s experts.

Last week in Birmingham eight teams from the West Midlands were pitted against each other to make it to the area finals in February. Disproving George Bernard Shaw’s gibe that if you laid all the economists in the world end to end they would still fail to reach a conclusion, the schools were unanimous in recommending the base rate was held at 5.75 per cent.

Royal Grammar School Worcester and Alice Ottley School won, beating Coventry’s Bablake School, who finished as runners-up. Chris Davis, the winning captain, said that the competition had helped him to put economic theory into practice and understand what is happening in the economy. Like many of the participants, he is applying to study economics at university.

Indeed, the competition is already proving a fertile training ground for future rate-setters: one of the judges in the Birmingham heats took part in the first competition eight years ago.

“These are interesting and exciting times for monetary policy, although I’m not sure that’s how the MPC would describe it,” John Bartlett, the Bank’s agent in the West Midlands and a judge of the heat, said.

Mr Bartlett says that the competition aims to bring the “dismal science” to life. “All the teams were very strong on the different effects of the credit crunch, which is a new problem that the text books won’t tell you how to answer.”

For Becky Broom, from the Kenilworth School, the heats were the culmination of weeks of staying late at school to pore over graphs and statistical tables.

“Most of my friends don’t even know what the interest rate is,” she said. “I practised the presentation on one of them and they thought it was a foreign language.”

After participating in the competition she switched her university application to economics and business management.

Explore Economics

• Autumn Budget 2007

• Budget 2008

• World Economic Forum

• The Times MPC

Times Recommends

• Darling under pressure on record public debt
• Mortgage lending falls 32% as drought deepens
• Oil prices firm after 10% drop to below $130