An economy is experiencing stagnant GDP growth and high structural unemployment.
Which one of the following policy combinations is most likely to stimulate long-run economic growth and reduce unemployment while minimizing inflationary pressures?
A reduction in the standard rate of VAT and a decrease in reserve requirements for commercial banks
An increase in corporation tax and a rise in the central bank's policy interest rate
An increase in state pension payments combined with extensive quantitative easing
Government grants for industrial research and development alongside labour market deregulation
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.