AS Level Paper 2, June 2023

Q1(a) Explain one likely impact on UK aggregate supply of an interventionist supply-side policy (context: healthcare spending rising from £175.1bn to £219.9bn between 2019 and 2020).

Q1(b) Which option is also interventionist supply-side policy: cutting jobless benefits, deregulating product markets, expanding training schemes or raising corporation tax?

Q2(a) Say what GDP per capita means (short definition).

Q2(b) From UK real GDP per capita figures for 2018–2020, pick the likeliest consequence of the 2019-to-2020 movement (falling living standards / lower unemployment / stronger consumer confidence / rising prices).

Q2(c) Give one justification for making comparisons using Purchasing Power Parities.

Q3(a) From 2021–22 figures on the UK government’s tax receipts presented in a chart, select the conclusion those data support.

Q3(b) Given UK government tax revenue of £820bn and expenditure of £1 053bn for 2021–22, explain the likely impact on the government's budget balance.

Q4(a) Give the economic meaning of investment (short definition).

Q4(b) Using UK business investment data for 2019 and 2020 with 2019 as the base year, identify the index number for 2020. (9.7 / 90.3 / 109.7 / 110.8)

Q4(c) Mark up an AD/AS diagram showing how weaker business investment affects equilibrium real output alongside the price level.

Q5(a) Using a chart of the UK real GDP growth rate (Q1 2019 to Q3 2021), identify which statement can be deduced.

Q5(b) Using the chart, set out one way firms stand to gain from economic growth.

Q6(a) Drawing on Figure 1, say what the balance of trade in goods and services measures.

Q6(b) Using Figure 2, set out how CPI inflation gets calculated, bringing the idea of weights into the explanation.

Q6(c) Drawing on Extract A, assess what higher export values would mean for the UK economy.

Q6(d) Using Extract B, explain two causes behind UK inflation climbing.

Q6(e) Discuss how rapid UK inflation is likely to affect both consumers and workers.

Q6(f) Evaluate which factors most shape the UK's net trade position.

Q6(g) Evaluate the use of interest rate policy as a tool for holding down UK inflation.