Skip to content

Course home

Sign up

2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts

EasyMediumHard
123456789101112131415161718192021222324252627282930313233343536373839404142434445464748495051525354555657585960616263646566676869707172737475767778798081828384858687888990919293949596979899100101102103
Question 90

A small open economy experiences a simultaneous increase in planned investment by firms of £35m£35\text{m}£35m and an increase in government expenditure on national infrastructure of £45m£45\text{m}£45m. As a result of these injections, the equilibrium national income increases by £200m£200\text{m}£200m.

All other things being equal, what is the value of the national income multiplier?

A

0.400.400.40

B

0.600.600.60

C

2.502.502.50

D

5.715.715.71

Markscheme

2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts Questions

  1. A Level
  2. /Economics
  3. /2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts

222 exam-style questions on AQA A Level Economics 2.2 How the macroeconomy works: the circular flow of income, aggregate demand/aggregate supply analysis and related concepts, covering 2.2.1 The circular flow of income, 2.2.2 Aggregate demand and aggregate supply analysis, 2.2.3 The determinants of aggregate demand, 2.2.4 Aggregate demand and the level of economic activity, 2.2.5 Determinants of short-run aggregate supply, and 2.2.6 Determinants of long-run aggregate supply. Each one has a worked solution and a mark scheme showing where the marks go.

Question bank