Economic growth

UK real GDP percentage growth, quarter 1 (Q1) 2022 to quarter 1 (Q1) 2023.

(Source adapted from: https://www.ons.gov.uk/economy/grossdomesticproductgdp/ bulletins/quarterlynationalaccounts/januarytomarch2023)

With reference to the chart above, which one of the following is correct?

Explain one likely disadvantage of a decline in GDP on:

workers

government.

UK real GDP, 2020–2022

*2022 figures are forecast

(Source: adapted from https://www.ons.gov.uk/economy/grossdomesticproductgdp)

Calculate the value of the total forecast GDP in 2022.

Explain one likely cost of UK real GDP falling by 9.9% in 2020.

Which one of the following is most likely to lead to an increase in potential economic growth?

An increase in:

Using the data provided in Extract D, explain one role of financial markets.

Examine two reasons why retailers on the high street tend to remain small.

Discuss possible methods of price and non‑price competition that firms could use to increase the value of sales on the high street.

EITHER

Evaluate the microeconomic and macroeconomic effects of falling house prices.

Evaluate the microeconomic and macroeconomic effects of labour shortages in the UK, or a developed economy of your choice.

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Explain one reason why a country such as Germany wants to avoid an increase in the national debt relative to GDP (Figure 2).

Examine two likely effects of the forecast change in the rate of unemployment between 2019 to 2020, on firms in Germany. Refer to Figure 4 in your answer.

Discuss the likely impact of investment in new technology on the profitability of firms in Germany, as described in Extract C line 20. Use a cost and revenue diagram to support your answer.

EITHER

Evaluate the microeconomic and macroeconomic factors which are likely to determine the level of economic growth in Germany relative to other developed economies.

Evaluate the microeconomic and macroeconomic impacts of ‘a much more expansionary fiscal policy’ (Extract C line 23) on the German economy.

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In 2018, the United States Government cut the corporation tax rate (tax on company profits) from 35% to 21%. Income tax rates for US citizens were also reduced: for example, the top rate of income tax was cut from 39.6% to 37%.

(Source adapted from: https://www.nytimes.com/)

Evaluate the likely impact of cutting tax rates as a policy to increase economic growth.

In 2016 the UK Chancellor of the Exchequer announced that the government would spend an extra £23 billion on innovation and infrastructure over the following five years.

Evaluate the likely economic effects of this planned increase in government expenditure.

The British pound fell by over 10% to a 30-year low against the US dollar after the UK voted to leave the European Union.

To what extent will this depreciation impact on future economic growth in the UK?

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