A-LevelEconomicsGovernment Macroeconomic InterventionFeb/Mar 2025Paper 1 Q241 Mark
A government decides to use supply-side policy to increase long-run aggregate supply (LRAS). What is the most likely reason why this policy tool will not lead to a fall in the price level?
AAggregate demand will also increase.
BLabour productivity levels will increase.
CWorkers will save any extra wages they earn.
DWorkers will spend any extra wages on imports.
✓ Correct Answer
The correct answer is A. This question tests the candidate's understanding of government macroeconomic intervention within the Economicssyllabus. The examiner's mark scheme requires...
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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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