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1.1 Economic methodology and the economic problem

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Question 83

Which one of the following is a normative economic statement?

A

An increase in the rate of value-added tax (VAT) from 20%20\%20% to 22%22\%22% will reduce the real disposable income of the lowest income decile by more than that of the highest income decile.

B

The central bank should prioritize price stability over reducing unemployment because inflation is a more damaging economic problem.

C

A depreciation of the pound sterling relative to the US dollar increases the price competitiveness of UK manufacturing exports in global markets.

D

In the long run, a legal minimum wage set above the market-clearing wage leads to an excess supply of labour.

Markscheme

1.1 Economic methodology and the economic problem Questions

  1. A Level
  2. /Economics
  3. /1.1 Economic methodology and the economic problem

123 exam-style questions on AQA A Level Economics 1.1 Economic methodology and the economic problem, covering 1.1.1 Economic methodology, 1.1.2 The nature and purpose of economic activity, 1.1.3 Economic resources, 1.1.4 Scarcity, choice and the allocation of resources, and 1.1.5 Production possibility diagrams. Each one has a worked solution and a mark scheme showing where the marks go.

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