Economics 9708 · AS & A Level · Supply-side policy

Supply-side policy — practice question

(a)[4]

The information is about supply-side policies. Explain, with two examples, what is meant by supply-side policies.

(b)[4]

Explain briefly how the rate of interest is linked to investment and employment. Consider whether this is supported by the information in Fig. 1.

(c)[6]

The information refers to rising house prices, and politicians sometimes say that such an increase is a sign that the economy is improving. Analyse how the economy is said to gain from rising house prices but can also gain from lower oil prices.

(d)[6]

Summarise the main argument of the information. Discuss whether the information gives enough evidence to support it.

Worked solution & mark scheme

This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: Supply-side policies are mainly micro-economic measures intended to make markets and industries function more efficiently.

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