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3.5 Fiscal policy

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Question 35

The government has a fixed sum that it can use either to increase State Pension payments or to buy additional equipment for the police, but not both. It uses the sum to increase State Pension payments.

Which of the following is the opportunity cost of this choice?

[1]
A

The cost of administering the higher State Pension payments

B

The higher payments received by State Pension recipients

C

The amount that would have been spent on the police equipment

D

The services that the additional police equipment would have helped to provide

Markscheme

3.5 Fiscal policy Questions

  1. GCSE
  2. /Economics
  3. /3.5 Fiscal policy

76 exam-style questions on OCR GCSE Economics 3.5 Fiscal policy, covering 3.5.1 Government spending and revenue, 3.5.2 Budget balance, surplus and deficit, 3.5.3 What is fiscal policy, 3.5.4 Calculate effects of taxes and spending, 3.5.5 Analyse effects of taxes and spending, 3.5.6 Costs and benefits of fiscal policy, and 3.5.7 Redistributing income and wealth. Each one has a worked solution and a mark scheme showing where the marks go.

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