OCR A Level Economics Macroeconomics November 2021 question paper H460/02

1 (a) Using information from the stimulus material, identify two stages of the economic cycle.

Using Fig. 1, explain the relationship between changes in consumer expenditure and changes in income.

Calculate Switzerland’s marginal propensity to withdraw.

Using Fig. 3, explain what is likely to have happened to UK share prices at the start and the end of the period shown.

Using information from the stimulus material, evaluate whether a recession will increase the

number of people unemployed.

* Using information from the stimulus material, evaluate whether a negative interest rate

would help the government achieve its macroeconomic objectives.

2* In 2017 Bosnia had a significant output gap while it was estimated that Slovenia did not have an output gap.

Evaluate, with the use of an appropriate diagram(s), whether a government should always seek

to reduce an output gap.

3* In March 2018 the French government announced that children would have to start school at age 3 rather than age 6 from September 2019.

Evaluate, with the use of an appropriate diagram(s), whether a fall in the compulsory school

starting age will benefit an economy.

4* The UK’s deficit on the current account of its balance of payments in the first quarter of 2018 was £17.7bn (3.4% of GDP). This was a reduction on the deficit of £19.5bn (3.8% of GDP) in the last quarter of 2017.

Evaluate whether the UK would benefit from a reduction in the deficit on the current account of

the balance of payments.

5* In 2018 both Australia and Ireland had a high Human Development Index (HDI), 0.939 and 0.938. They did, however, have different rates of poverty.

Evaluate whether a country with a high HDI is likely to have a low rate of poverty.