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Date November 2019 Marks available 15 Reference code 19N.1.HL.TZ0.4
Level Higher level Paper Paper 1 Time zone Time zone 0
Command term Discuss Question number 4 Adapted from N/A

Question

Explain the effect an increase in investment might have on real gross domestic product (GDP) using the Keynesian multiplier.

[10]
a.

Discuss the view that interventionist supply-side policies are the most effective way for a government to achieve economic growth.

[15]
b.

Markscheme

Marks should be allocated according to the paper 1 markbands for May 2013 forward, part A.

Answers may include:

Award a maximum of level 2 marks if a candidate does not use the concept of the Keynesian multiplier.

a.

Marks should be allocated according to the paper 1 markbands for May 2013 forward, part B.

Answers may include:

Discussion may include: consideration of alternative policies (market-based supply-side policies, expansionary monetary policies, expansionary fiscal policies) with regard to factors such as time lags, the ability to create employment, the impact on the government budget, the short-run effect on the AD, the administrative requirements and the political support required for their implementation, social effects and effects on the environment.

Examiners should be aware that candidates may take a different approach which, if appropriate, should be rewarded.

b.

Examiners report

[N/A]
a.
[N/A]
b.

Syllabus sections

Last exams 2021 » Section 2: Macroeconomics » 2.6 Supply-side policies » Evaluation of supply-side policies » The strengths and weaknesses of supply-side policies
Last exams 2021 » Section 2: Macroeconomics » 2.6 Supply-side policies » Evaluation of supply-side policies
First exams 2022 » Unit 3: Macroeconomics » 3.7 Supply-side policies » 3.7.6 Effectiveness of supply-side policies
Last exams 2021 » Section 2: Macroeconomics » 2.6 Supply-side policies
First exams 2022 » Unit 3: Macroeconomics » 3.7 Supply-side policies
Last exams 2021 » Section 2: Macroeconomics
First exams 2022 » Unit 3: Macroeconomics
First exams 2022
Last exams 2021

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