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Money and interest rates

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Question 1

The table below shows selected macroeconomic indicators for a hypothetical economy between 2025 and 2029.

Economic Indicator20252026202720282029
Real GDP Growth Rate (%)3.21.1-4.5-0.22.5
CPI Inflation Rate (%)2.41.80.2-0.81.5
Central Bank Policy Rate (%)3.502.000.250.051.25
Household Savings Rate (%)6.58.214.518.09.5

In which year was this economy most at risk of experiencing a liquidity trap?

2026

2027

2028

2029

Money and interest rates Questions

  1. A Level
  2. /Economics
  3. /Money and interest rates