A-LevelEconomicsInflationMay/June 2015Paper 1 Q251 Mark
In an economy with an interest rate of 4% per annum, the rate of inflation falls from 5% to 3% per annum. What will be a benefit of this fall?
AMenu costs will fall to zero.
BPeople on fixed incomes will be better off in real terms.
CSavers will gain in real terms.
DThe purchasing power of the currency will rise.
✓ Correct Answer
The correct answer is C. This question tests the candidate's understanding of 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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