A-LevelEconomicsGovernment Macroeconomic InterventionMay/June 2018Paper 3 Q291 Mark
The Consumer Prices Index (CPI) fell by 3% in a year. Unemployment was regarded as unacceptably high. Which combination of policies would a government be most likely to adopt in such circumstances? A an appreciation of the currency, together with an increase in the rate of interest B increased government expenditure on education, together with an increase in taxes to pay for it C increased indirect taxes, together with a depreciation in the exchange rate D reduced income taxes, together with a cut in the rate of interest
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