Specification point 2.2.4 · Theme 2

Government expenditure (G)

Aggregate demand (AD) · The UK economy – performance and policies

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5 questions

Essay questions

Long-form evaluation and discussion

1
A-level Paper 2, June 2018, Q7EssayEvaluate
Optional25 marks
ContextIn 2016 the UK Chancellor of the Exchequer announced that the government would spend an extra £23 billion on innovation and infrastructure over the following five years.

Evaluate the likely economic effects of this planned increase in government expenditure.

4.5.1 · Public expenditure2.2.4 · Government expenditure (G)2.4.4 · The multiplier
Public expenditure revision notes Government expenditure (G) revision notes The multiplier revision notes
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Data-response questions

Questions built around exam extracts

2
AS Paper 2, June 2025, Q6(e)Data responseDiscuss
15 marks

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

2.2.4 · Government expenditure (G)2.6.2 · Demand-side policies2.4.4 · The multiplier
Government expenditure (G) revision notes Demand-side policies revision notes The multiplier revision notes
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A-level Paper 2, June 2022, Q6(e)Data responseDiscuss
15 marks

Case study · UK Government spending and inequality

With reference to Extract B, discuss the benefits of an increase in infrastructure spending 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

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4.5.1 · Public expenditure2.2.4 · Government expenditure (G)2.3.3 · Long-run AS
Public expenditure revision notes Government expenditure (G) revision notes Long-run AS revision notes
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Short-answer questions

Focused calculations, explanations and diagrams

1
A-level Paper 2, June 2019, Q2(a)Short answerDraw
4 marks
ContextThe International Monetary Fund has called on the G20 group of large industrialised countries to boost government spending on infrastructure.

Draw an aggregate demand and aggregate supply diagram to show the likely impact of an increase in government spending on infrastructure on a country’s price level and real output.

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2.2.4 · Government expenditure (G)2.3.3 · Long-run AS
Government expenditure (G) revision notes Long-run AS revision notes
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Multiple-choice questions

Quick checks of economic understanding

1
AS Paper 2, June 2018, Q5(a)Multiple choice
1 mark
ContextThe chart below shows selected areas of forecast UK government spending for 2015/16 and 2016/17. 232 Social protection 240 141 Health 145 Education 102 Defence Housing …

Which one of the following can be inferred from the chart? In 2016/17:

Athe change in forecast UK government spending is highest on education
Bthe forecast UK government spending in all areas has fallen from 2015/16
Cthe forecast UK government spending on defence is twice as much as the forecast spending on housing
Dthe percentage change in forecast UK government spending on
2.2.4 · Government expenditure (G)
Government expenditure (G) revision notes
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