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AS & A Level · AS/A Level

Economics

Fiscal, monetary and supply policies

Name: ____________________Date: October 10, 2026
  1. 1.

    Explain how progressive income taxes can act as an automatic stabiliser during a recession without a new policy decision.

    [2 marks] · no calculator
  2. 2.

    Fictional government: tax receipts are 420 million, spending excluding interest is 460 million and interest payments are 20 million. Calculate the primary and overall budget balances, defining balance as receipts minus spending.

    [3 marks]
  3. 3.

    Fictional case: the policy interest rate falls, but banks tighten lending standards and most households have fixed-rate loans. Analyse why consumption and investment might respond weakly.

    [4 marks] · no calculator
  4. 4.

    Fictional case: a government funds apprenticeships and faster freight infrastructure. Analyse how each can affect long-run aggregate supply and why budget expenditure alone does not prove success.

    [4 marks] · no calculator
  5. 5.

    Fictional case: Navo is in recession with low interest rates and substantial public debt. Evaluate temporary infrastructure spending financed by borrowing.

    [4 marks] · no calculator
  6. 6.

    Fictional case: Rima proposes deregulating entry into electricity retail while keeping the transmission network regulated. Evaluate the potential benefits and limits of this split.

    [4 marks] · no calculator

Original, unofficial practice questions from SubjectScout — not official past-paper questions.

Marking points are indicative, not an official mark scheme. Accept equivalent valid methods and supported interpretations that address the task; award each mark once without requiring the model wording.