A-LevelEconomicsMonetary Policy / InflationOct/Nov 2021Paper 1 Q291 Mark
What would make a policy of raising interest rates less likely to be effective in reducing inflation?
AAggregate supply is increasing faster than aggregate demand.
BConsumers expect prices to rise even faster in the future.
CConsumers' spending is largely paid for on credit.
DInterest rates are still higher abroad.
✓ Correct Answer
The correct answer is B. This question tests the candidate's understanding of monetary policy / inflation within the Economicssyllabus. The examiner's mark scheme requires...
📋 Examiner Report & Trap Analysis
Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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