Economics 9708 · AS & A Level · Perfect competition
Explain the circular flow of income in a closed economy and consider the extent to which the circular flow of income changes as an economy becomes an open economy.
Assess whether the consequences of economic growth for an economy are always positive.
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “AO1 Knowledge and understanding (max 3): Clear knowledge and understanding that the circular flow of income in a closed economy includes households, firms, and the government, with injections of I and G and leakages/withdrawals of S and T, so equilibrium income is where I + G = S + T.” …