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House price latest

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House prices up by 6.9%.

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Model agencies collude to fix rates

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Regulators find leading model agencies guilty of price fixing.

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Question 1

Assuming the economy is in an initial equilibrium at X, identify where the new equilibrium will be if:

Fiscal policy
  1. There is a rise in public sector borrowing.

  2. There is a rise in government government subsidies to the motor industry.

  3. The government spends less on defence.

  4. The basic rate of income tax is raised.

  5. The VAT rate is cut from 20%  to 15%.

Question 2

  1. Analyse the likely impact on the UK economy, or an economy of your choice, of an increase in government spending on higher education.

  2. What are the main disadvantages of an increase in income tax, assuming the economy has a significant output gap?

  3. What are the main disadvantages of an increase in government spending not matched by an increase in taxation?

Question 3

  1. Distinguish between automatic and discretionary fiscal policy.

  2. How did the financial crisis affect the UK's national debt?

  3. Evaluate the possible contribution of both fiscal policy and monetary policy during an economic recession.

  4. Give three advantages and three disadvantages of using government spending to influence aggregate demand.

  5. Evaluate 'crowding out' theory.


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Costs and benefits of customs unions.

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Multiple choice papers for Paper Three.

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Article 50

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Savings ratio

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Savings ratio falls to lowest level on record.

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