Macroeconomics

Table of Contents

1. Topic pack - Macroeconomics - introduction
2. 2.1 The level of overall economic activity (notes)
3. 2.1 The level of overall economic activity (questions)
4. Section 2.2 Aggregate demand and supply (notes)
5. Section 2.2 Aggregate demand and supply (simulations and activities)
6. 2.2 Aggregate Demand and Aggregate Supply (questions)
   1. AD/AS - self-test questions
   2. Short questions
   3. Data response (1)
   4. Data response (2)
   5. Long questions
7. 2.3 Macroeconomic objectives (notes)
8. Low Unemployment
9. 2.3 Macroeconomic objectives (questions)
10. 2.4 Fiscal policy (notes)
11. 2.4 Fiscal policy (questions)
12. 2.5 Monetary policy (notes)
13. 2.5 Monetary Policy (questions)
14. Section 2.6 Supply-side policies (notes)
15. 2.6 Supply-side policies (questions)
16. Print View

Long questions

Question 1

(a) Explain why the value of the multiplier may vary over time and from country to country.

(b) Explain how the multiplier and the accelerator principles help understand the dynamics of the business or trade cycle.

Question 2

(a) Using aggregate demand and supply diagrams to aid your analysis, explain the difference between an inflationary and deflationary gap.

(b) Evaluate the policy options open to a government that wants to close a deflationary gap and reduce unemployment.