CourseCourseConceptConceptDocsDocuments

CAIE A-Level Economics AS 5.2 Fiscal Policy Questions

Practise analysing fiscal policy through budgets, tax, spending, debt and AD/AS effects in data tables and policy scenarios.

Syllabus
2026–2028
Course
Economics 9708
Level
AS

Exam points

  • interpret government revenue and spending tables to identify deficits, surpluses or debt effects
  • classify tax and spending decisions as expansionary or contractionary fiscal policy
  • use AD/AS to explain how fiscal policy changes aggregate demand and output

Covered syllabus points

5.2.1—Government budget5.2.2—Budget deficit and surplus5.2.3—National debt5.2.4—Taxation5.2.5—Government spending5.2.6—Fiscal policy stance5.2.7—Fiscal policy in AD/AS

Question 1

[Maximum number: 1]

Which statement about government budget surpluses and deficits is the most accurate?

A

A surplus implies that the balance of payments is in surplus.

B

A surplus implies that the government is spending too much money.

C

A deficit implies that the economy is in decline.

D

A deficit implies that the national debt is increasing.

Question 2

[Maximum number: 1]

What is the equivalent of a country's national debt?

A

the accumulated borrowing of the government

B

the difference between government spending and taxation

C

the interest paid by the government on all the money it owes

D

the total money owed by all households in the country

Question 3

[Maximum number: 1]

What is most likely to be regressive?

A

corporate profit taxes

B

state pension benefits

C

specific tax on cigarettes

D

unemployment benefits

All question bank results loaded