AS · June 2025 · Paper 2
Which one of the following best describes this cause of unemployment?
With reference to the information above, explain one possible effect of the increase in the rate of unemployment on the UK government budget.
Which one of the following can be deduced from the table?
Explain one likely impact of the fall in average UK house prices on existing homeowners between January 2023 and March 2023. Refer to the table on page 4 in your answer.
Which point on the trade cycle diagram illustrates a positive output gap?
Diagram needed. Open the original question paper for the diagram
Explain one reason why it is difficult to measure the size of an output gap in an economy.
Define the term ‘trade cycle’.
Define the term ‘indirect tax’.
Annotate the aggregate demand (AD) and short-run aggregate supply (SRAS) diagram below to show the likely impact of a reduction in indirect tax on the equilibrium level of real output and the price level.
Diagram needed. Open the original question paper for the diagram
Which one of the following is an example of an indirect tax?
Which one of the following can be deduced from the chart?
Explain one likely reason for the deficit in the UK balance of trade in goods and services. Refer to the chart on page 10 in your answer.
Case study · UK living standards and supply-side policies
With reference to Figure 1, explain the term ‘rate of economic growth’.
Case study · UK living standards and supply-side policies
With reference to the first paragraph of Extract A, explain the likely relationship between real incomes and subjective happiness.
Case study · UK living standards and supply-side policies
With reference to Extract A and your own knowledge, assess the limitations of using GDP to compare living standards over time.
Case study · UK living standards and supply-side policies
With reference to the information provided, explain two factors that the Bank of England’s Monetary Policy Committee may have considered when changing the base interest rate.
Case study · UK living standards and supply-side policies
Discuss the likely macroeconomic effects of a decrease in government expenditure on the UK economy. Use an aggregate demand and aggregate supply diagram to support your answer.
Diagram needed. Open the original question paper for the diagram
Case study · UK living standards and supply-side policies
Evaluate the possible causes of inflation in the UK.
Case study · UK living standards and supply-side policies
Evaluate the use of market-based supply-side policies to increase UK employment.