A government wishes to implement a discretionary fiscal policy specifically targeted at reducing its structural budget deficit. Which of the following measures represents the implementation of such a policy?
An increase in the standard rate of Value Added Tax (VAT)
A fall in the total government expenditure on unemployment benefits during an economic recovery
A reduction in the central bank's policy interest rate to lower the cost of servicing national debt
Selling short-term Treasury bills to domestic financial institutions to cover a revenue shortfall
68 exam-style questions on OCR A Level Economics Fiscal policy. Each one has a worked solution and a mark scheme showing where the marks go.