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CAIE A-Level Economics AS 5.2.7 Fiscal Policy in Ad As Questions

Practise using AD/AS analysis to trace expansionary and contractionary fiscal policy effects on output, prices, employment and national income.

Syllabus
2026–2028
Course
Economics 9708
Level
AS

Exam points

  • Use AD/AS analysis to explain how expansionary and contractionary fiscal policy change national income, real output, prices and employment.

CAIE A-Level Economics AS 5.2.7 Fiscal Policy in Ad As Questions question 1

[Maximum number: 1]

What is most likely to decrease if a government uses expansionary fiscal policy?

A

a balance of payments deficit

B

cyclical unemployment

C

the level of wages

D

the rate of inflation

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