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2.5 Fiscal policy and supply-side policies

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Question 16

A government is considering how to fund additional spending on green energy infrastructure. One option is to raise the rate of tax charged on the profits of medium-sized enterprises from 15% to 22%.

All other things being equal, for every 8 firms earning profits of £2 million£2\text{ million}£2 million, by how much could the government increase its spending on green energy without affecting the budget balance?

A

£140 000£140\ 000£140 000

B

£1 120 000£1\ 120\ 000£1 120 000

C

£2 400 000£2\ 400\ 000£2 400 000

D

£3 520 000£3\ 520\ 000£3 520 000

Markscheme

2.5 Fiscal policy and supply-side policies Questions

  1. A Level
  2. /Economics
  3. /2.5 Fiscal policy and supply-side policies

245 exam-style questions on AQA A Level Economics 2.5 Fiscal policy and supply-side policies, covering 2.5.1 Fiscal policy and 2.5.2 Supply-side policies. Each one has a worked solution and a mark scheme showing where the marks go.

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