Extract C (lines 12–14) states: ‘With the central bank reducing interest rates, households have access to cheaper credit, raising consumer confidence and spending, which leads to short-run economic growth.’
Draw a production possibility frontier (PPF) diagram for an economy producing capital goods and consumer goods to show short-run economic growth.
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.