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2.4 Financial markets and monetary policy (A-level only)

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Question 55

The Monetary Policy Committee (MPC) of the Bank of England is most likely to decrease the benchmark interest rate (Bank Rate) if

A

the annual growth rate of nominal wages significantly exceeds the growth rate of labour productivity.

B

the domestic currency depreciates rapidly, leading to a rise in the price of imported raw materials.

C

the growth of nominal aggregate demand falls below the growth rate of the economy's productive capacity, alongside a rising household saving ratio.

D

the economy is experiencing a narrowing negative output gap and rising capacity utilisation.

Markscheme

2.4 Financial markets and monetary policy (A-level only) Questions

  1. A Level
  2. /Economics
  3. /2.4 Financial markets and monetary policy (A-level only)

176 exam-style questions on AQA A Level Economics 2.4 Financial markets and monetary policy (A-level only), covering 2.4.1 The structure of financial markets and financial assets, 2.4.2 Commercial banks and investment banks, 2.4.3 Central banks and monetary policy, and 2.4.4 The regulation of the financial system. Each one has a worked solution and a mark scheme showing where the marks go.

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