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

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Question 35

Which one of the following statements regarding the operation of UK monetary policy is correct?

A

The Bank of England is responsible for changing tax rates to control aggregate demand.

B

The inflation target is determined by the central bank's Monetary Policy Committee.

C

The central bank adjusts its interest rate decisions in response to changes in the government's fiscal stance.

D

Quantitative easing has no impact on commercial banks' excess reserves or the money supply.

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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