AS Level Paper 2, June 2017

Q1(a) From UK Consumer Prices Index figures (2005 = 100), work out the percentage change over the year to September 2015.

Q1(b) State what deflation means (2 marks).

Q1(c) Identify which listed fall would most plausibly bring about deflation (oil prices / unemployment / income tax / interest rates).

Q2(a) Using the statement given, explain under-employment, where UK workers wanting longer hours climbed from 76 482 to 142 788.

Q2(b) Select the likeliest driver of a lower unemployment rate (bigger unemployment benefits / falling real GDP / reduced apprenticeship funding / rising consumer spending).

Q3(a) Using a chart of real GDP in selected economies (2008 = 100), identify which statement can be inferred.

Q3(b) Give the meaning of real GDP (2 marks).

Q3(c) Show where a negative output gap sits on the supplied AD/AS diagram.

Q4(a) Label an AD/AS diagram with the probable effect on UK price level and real output of raising the personal allowance to £11 000 from £10 600.

Q4(b) State what a direct tax is (2 marks).

Q4(c) Pick out the direct tax from four listed levies (VAT / Vehicle Excise Duty / corporation tax / alcohol duty).

Q5(a) From a 2008–2015 chart of UK consumer confidence, explain one plausible cause of its movement across 2012 to 2015.

Q5(b) Say which marginal propensity would most likely fall once UK consumer confidence strengthens (consume / tax / import / save).

Q6(a) Drawing on Figure 1, set out what net trade means.

Q6(b) Assess what has probably produced the UK trade deficit, using the material supplied plus your own knowledge.

Q6(c) Using Extract A, explain one factor that plausibly shapes investment in the UK.

Q6(d) From Figure 2 and Extract A, give two explanations for UK nominal GDP per capita at PPPs growing more slowly than Germany's post-2010.

Q6(e) Evaluate the policy options open to government for raising UK productivity.

Q6(f) Evaluate how far the UK gains from economic growth while worries about its economy persist (Extract A).

Q6(g) Evaluate the claim in Extract A that the UK cannot avoid a further recession.