(a)
- State an example of an item included in the balance on primary income. [1]
- State an example of an item included in the balance on secondary income. [1]
- Describe the trend in Poland’s current account balance from 2014 to 2016. [2]
(b)[2]
Identify two policies adopted by the Polish government that could be considered as supply-side policies.
(c)[4]
Explain, with the help of a diagram, why the imposition of an indirect tax, such as a general sales tax, could discourage entrepreneurs from investing.
(d)[4]
Consider, using Extract 2, the likely changes in Poland’s aggregate demand in 2017.
(e)[6]
Discuss whether increasing the Polish government’s budget deficit will always have a positive impact on Poland’s economy.