Economic Performance (AQA A Level Economics): Exam Questions

The long-run Phillips curve shows that

An economy is estimated to be experiencing a 2% rate of frictional unemployment plus a 3% rate of structural and real wage unemployment. If it is also experiencing cyclical unemployment of 4%, its natural rate of unemployment is most likely to be

The table below contains selected data on a country’s macroeconomic performance over a 20 year period. 

All other things being equal, which one of the following, A, B, C or D, can be inferred from the above data?

All other things being equal, if the velocity of circulation is constant, the quantity theory of money based on Fisher’s equation of exchange, MV=PQ, predicts that an x% increase in the money supply will always cause an x%

The diagram below shows the actual level of real GDP and the trend level of real GDP over time for an economy. The economy starts its recovery from recession at point M. After several years of growth the economy reaches point N.

All other things being equal, which one of the following is the most likely consequence of the economy’s growth path between points M and N? 

The short-run Phillips curve below illustrates the relationship between unemployment and inflation in an economy.

The Phillips curve shows that in this economy.

The table below shows indices for real GDP and consumer prices in an economy over six quarters.

During these six quarters the economy experienced 

The primary measure of unemployment in the UK is based on the

The table below shows the Consumer Prices Index for a country over a number of years.

 Which one of the following can be concluded from the table?

Which one of the following changes in macroeconomic performance is most likely to involve a trade-off, at least in the short-run, between the objectives of government macroeconomic policy?

Which one of the following combinations of possible shocks: A, B, C, or D, is most likely to move an economy from a negative output gap to a positive output gap?

An unexpected increase in

An economy operating at its long-run productive capacity at the start of 2020 has a trend rate of growth of 6% per year. Real GDP increases by 2% in 2021 and 10% in 2022.

Which one of the following accurately describes the position of the economy at the end of each year?

Figure 4 shows a short-run Phillips curve (SRPC) and a long-run Phillips curve (LRPC).

Government intervention moves the economy from position A to position B and then the economy moves from position B to position C.

Figure 4

Which one of the following is most likely to explain the movement from position B to position C?

Figure 4 shows the aggregate demand (AD) curve, the short-run aggregate supply (SRAS₁ and SRAS₂) curves and the long-run aggregate supply (LRAS₁ and LRAS₂) curves for an economy.

All other things being equal, which one of the following is most likely to move the economy from point M to point N?

Which one of the following diagrams, A, B, C or D, shows the most likely short-run impact on an economy of an improvement in technology in the production process?

Table 3 shows different combinations of performance for three macroeconomic indicators. Which one of the combinations, A, B, C or D, is most likely to indicate an economy experiencing an economic boom?

Table 3

Changing patterns of consumption have meant that summer holidays at UK seaside towns have become less popular. As a result, UK seaside holiday towns are affected by seasonal unemployment and increasing structural unemployment.

Which one of the following is the most likely consequence of this change in the pattern of consumption?

An economy's long box -run trend rate of economic growth in real gross domestic product (GDP) is 2.8% per annum. In 2018, the economy's actual real GDP was equal to its trend level of real GDP. Table 4 shows the economy's actual rate of growth in real GDP over a five-year period.

Table 4

All other things being equal, in which year was the economy likely to experience the most inflationary pressure?