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

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Question 22

All other things being equal, which one of the following combinations of macroeconomic changes is most likely to cause a leftward shift in an economy's Aggregate Demand (ADADAD) curve?

A

A decrease in the marginal propensity to import, a rise in business confidence, and a decrease in corporate tax rates

B

An increase in the marginal propensity to save, a decrease in business confidence, and an appreciation of the exchange rate

C

An increase in direct taxation, a depreciation of the exchange rate, and a rise in government capital expenditure

D

A decrease in interest rates, an increase in household savings, and a fall in the demand for exports

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.

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