Money and banking are strongly connected. Money has several functions, one of which is acting as a standard for deferred payments, and it is used to pay workers, often paid straight into their bank accounts. Workers’ earnings vary according to the industry they are employed in. In some countries, lending by banks in both the private sector and the public sector (state-owned) has risen in recent years.
(a)[2]
Define the term ‘a standard for deferred payments’.
(b)[4]
Explain two reasons why pay for agricultural workers may be lower than pay for manufacturing workers.
(c)[6]
Analyse why banks in the private sector may make higher profits than public sector banks.
(d)[8]
Discuss whether a rise in bank lending will benefit an economy.
Worked solution & mark scheme
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