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2.6.2 Demand-side policies

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Question 1

With reference to the table below, explain one factor that the Monetary Policy Committee (MPC) of the Bank of England may have considered when reducing the base interest rate in March 2020.

UK Bank Rate, August 2018 to August 2021

Graph showing UK Bank rate starting at 0.75% in August 2018, remaining constant, and then dropping sharply twice in March 2020 to reach 0.25% and then 0.10%, staying at 0.10% until August 2021.

DateBank Rate (%)
1 August 20180.75
1 August 20190.75
11 March 20200.25
19 March 20200.10
1 August 20200.10
1 August 20210.10
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2.6.2 Demand-side policies Questions

  1. A Level
  2. /Economics
  3. /2.6.2 Demand-side policies