Explain the circular flow of income in a closed economy and consider the extent to which the circular flow of income changes as an economy becomes an open economy.

Marks: 8

With the help of a circular flow of income diagram, explain how equilibrium is determined in an open economy and consider whether a budget deficit or a trade deficit is more likely to cause lasting disequilibrium.

Marks: 8

Assess whether an increase in investment in new infrastructure projects will always have a positive impact on the circular flow of income in an economy.

Marks: 12

With the help of a diagram, explain what is meant by the circular flow of income in an open economy and consider the extent to which it can explain economic growth in such an economy.

Marks: 8

Explain how the circular flow of income in an economy changes when that economy moves from a closed to an open economy and consider what determines the extent of the change.

Marks: 8

Two countries each produce two products and wish to trade with each other. Explain the difference between the principles of absolute advantage and comparative advantage and consider whether the principle of comparative advantage is always the more important influence when each country is deciding whether to trade with each other.

Marks: 8

Explain the difference between an import tariff and an import quota and consider why a government would choose an import tariff rather than an import quota as a tool of protection in international trade.

Marks: 8

Assess whether the theories of absolute and comparative advantage are substantially undermined by their various limitations.

Marks: 12

Explain the difference between the terms of trade and the balance of trade in goods and consider whether an economy should be more concerned about its terms of trade than its balance of trade in goods.

Marks: 8

Explain how import tariffs might correct an imbalance in the current account of the balance of payments and consider whether these tariffs are the best way of correcting such an imbalance.

Marks: 8

Explain what is meant by a depreciation of the exchange rate and consider whether a depreciation is likely to increase domestic real output.

Marks: 8

Explain two possible causes of a change in the terms of trade in an economy and consider which of these causes is likely to be more important for low-income countries.

Marks: 8

Explain the potential advantages of free trade and consider whether such advantages are always greater than the potential disadvantages of free trade.

Marks: 8

With the help of a formula, explain two reasons for an improvement in the terms of trade and consider the extent to which an improvement in the terms of trade will benefit an economy.

Marks: 8

With the help of a diagram, explain two ways in which a fall in the balance of trade in goods may affect the value of a floating exchange rate and consider the extent to which a change in the relative rate of interest between two countries may have a greater impact on the exchange rate.

Marks: 8

The terms of trade index for an economy changed from 105 to 110 in a given year. Explain two likely reasons for this change and consider the extent to which the change is likely to benefit the current account of the balance of payments of this economy.

Marks: 8

With the help of a formula, explain the causes of an improvement in the terms of trade in an economy and consider whether such an improvement can ever be harmful to an economy.

Marks: 8

Assess whether the depreciation of an exchange rate is always beneficial to an economy.

Marks: 12

Assess whether expansionary monetary policy is likely to be successful in reducing all types of unemployment.

Marks: 12

Assess whether supply-side policies are the most effective way to correct a deficit on the current account of the balance of payments of an economy.

Marks: 12

Assess whether monetary policy or supply-side policy is likely to be more successful in reducing the rate of inflation in an economy.

Marks: 12

Assess whether the arguments for protectionism in the context of international trade are always stronger than the arguments against.

Marks: 12

Assess whether protectionism is the best way to correct a deficit in the current account of the balance of payments.

Marks: 12

Assess whether monetary policy is the only way to control a high rate of inflation.

Marks: 12

Assess how governments use macroeconomic intervention to achieve their macroeconomic objectives.

Marks: 12

Explain the reasons why governments impose taxes and consider whether an increase in income tax is fairer than an increase in sales taxes.

Marks: 8

Assess whether a government should always aim to balance its budget rather than have a budget surplus or a budget deficit.

Marks: 12

Assess whether supply-side policy is the only way of reducing long-term unemployment in an economy.

Marks: 12

Assess whether contractionary fiscal policy is likely to be the best way to reduce a current account deficit on the balance of payments.

Marks: 12

The Chinese government has re-emphasised its commitment to rebalancing the economy from one focused mainly on investment and exports to one aiming to increase the proportion spent on domestic consumption. Assess the extent to which it would be possible to achieve this by fiscal policy alone.

Marks: 12

Assess which expansionary macroeconomic policy would be most likely to enable a government to meet its economic objective of a low rate of unemployment.

Marks: 12

Assess whether supply-side policy is the most effective way to achieve long-run economic growth.

Marks: 12

Explain what is meant by protectionism and consider the effectiveness of using tariffs as a method of protectionism.

Marks: 8

Assess whether free trade is always better than a policy of protectionism for a developing economy that wishes to trade internationally.

Marks: 12

Assess whether increases in aggregate demand are the best way of reducing unemployment in a high-income country.

Marks: 12

Assess the extent to which different tools of protection can impact on the terms of trade in an economy.

Marks: 12

Assess whether a government should always aim for an expansionary fiscal policy rather than a contractionary fiscal policy.

Marks: 12

Assess whether supply-side policy is likely to be equally successful in reducing both structural and cyclical unemployment.

Marks: 12

With the help of examples, explain the difference between the marginal rate of taxation and the average rate of taxation and consider whether a government should decide to increase the rate of indirect tax to raise additional revenue.

Marks: 8

Assess whether the achievement of a balanced budget should always be a main government macroeconomic objective.

Marks: 12

Explain two methods of protection in international trade and consider which of these is likely to have the bigger impact on employment and output in the economy which imposes them.

Marks: 8

Assess whether protectionism is always the best way of reducing a deficit on the current account of the balance of payments.

Marks: 12

Assess the extent to which the consequences of free trade are always positive for an economy.

Marks: 12

Assess the extent to which supply-side policy is the best method to reduce the rate of inflation.

Marks: 12

Assess whether the potential benefits of free trade always outweigh the arguments for protectionism.

Marks: 12

Explain the difference between a budget surplus and a budget deficit and consider the extent to which a budget surplus is better than a budget deficit.

Marks: 8

Assess whether expansionary fiscal policy always benefits an economy.

Marks: 12

Assess the extent to which using fiscal policy would be the best way to reduce a high rate of inflation.

Marks: 12

Assess whether government policy can influence an economy's comparative advantage in a good or service.

Marks: 12

Explain why expenditure on education and training is a supply-side policy and consider why its impact on the general price level may differ between the short run and the long run.

Marks: 8

With the help of a diagram(s), explain one reason for an increase in aggregate demand and one reason for an increase in aggregate supply and consider whether an increase in aggregate demand will always lead to inflation.

Marks: 8

With the help of an aggregate demand and aggregate supply diagram, explain how a decrease in interest rates could cause economic growth and consider whether economic growth will always result in inflation.

Marks: 8

Explain three of the components of aggregate demand and consider the extent to which they may be increased without leading to inflation.

Marks: 8

With the help of a diagram, explain how increases in aggregate demand affect the level of real output and the price level in an economy and consider when such increases may become a problem.

Marks: 8

With the help of an AD/AS diagram, explain what is meant by an expansionary fiscal policy and consider the extent to which an expansionary fiscal policy will always increase the level of aggregate demand.

Marks: 8

With the help of an AD/AS diagram(s), explain one demand-side and one supply-side cause of deflation and consider which is likely to be more damaging to an economy.

Marks: 8

With the help of an AD/AS diagram(s), explain cost-push inflation and demand-pull inflation in an economy and consider in what circumstances one may be more damaging than the other.

Marks: 8

Explain how monetary policy may be able to reduce the rate of inflation in an economy and consider the likely success of this policy.

Marks: 8

Assess whether the internal effects of inflation are more serious than the external effects of inflation for an economy.

Marks: 12

In 2021, year-on-year inflation in many economies increased to a level not experienced for fifty years. With the help of a diagram, explain what is meant by cost-push inflation and consider whether this type of inflation has affected your own economy since 2021.

Marks: 8

Assess whether the potential benefits of an increasing rate of inflation outweigh the potential costs for an economy.

Marks: 12

Assess whether the consequences of inflation in an economy are always negative.

Marks: 12

Explain what is meant by a deficit on the current account of an economy's balance of payments and consider whether a high rate of inflation will always lead to a deficit on the current account of an economy's balance of payments.

Marks: 8

Assess whether a high rate of inflation or a deficit on the current account of the balance of payments is the more serious problem for an economy.

Marks: 12

Explain the difference between cost‑push and demand‑pull inflation and consider which is more likely to occur if there is a depreciation in the exchange rate of a country with few natural resources.

Marks: 8

Assess whether a rise or a fall in the terms of trade will benefit the macroeconomic performance of an open economy that is heavily dependent on international trade.

Marks: 12

A country has a persistent deficit on the current account of its balance of payments. Assess the likely consequences for the domestic and external economy of this country.

Marks: 12

Assess whether an economy will always benefit from having a surplus on the current account of its balance of payments.

Marks: 12

Assess whether an improvement in the terms of trade or a surplus on the current account of the balance of payments is of more benefit to an economy.

Marks: 12

Compare the causes of structural unemployment and cyclical unemployment and consider which of these types of unemployment is likely to be more harmful to an economy.

Marks: 8

With reference to a country that is known to you, explain the main causes of unemployment and consider which of these causes is most significant.

Marks: 8

Explain three causes of unemployment and consider which cause is likely to be most damaging to a high-income economy.

Marks: 8

Explain two methods of measuring unemployment and consider the extent of the possible difficulties in obtaining an accurate measurement of unemployment.

Marks: 8

Assess whether the consequences of economic growth for an economy are always positive.

Marks: 12

Assess whether economic growth is always desirable for an economy.

Marks: 12

Explain two possible causes of economic growth and consider whether the consequences of economic growth for an economy will always be positive.

Marks: 8

Explain two causes of economic growth and consider the extent to which their impact can be measured.

Marks: 8

Assess the extent to which economic growth is always beneficial for the people and government in an economy.

Marks: 12