Questions and Answers
What is the primary purpose of quantitative easing?
To stimulate the economy by increasing the money supply
How does raising interest rates affect consumer spending?
It encourages consumers to save more and spend less
What is the main goal of monetary policy in terms of inflation?
To control and keep inflation low in order to provide greater economic certainty
What is a deflationary gap?
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How does a weaker currency affect the price of imported goods?
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What is the relationship between the money supply and inflation?
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What is the main objective of monetary policy in the UK in recent years?
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According to monetarist economists, what is considered an important intermediate target of economic policy?
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How do monetarist economists believe an increase in the money supply will affect prices and incomes?
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Which economic concept is primarily targeted by the use of monetary policy?
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What is the purpose of setting intermediate objectives for monetary policy?
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What is the term used to describe the total demand in the economy for goods and services?
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How do poll taxes generally affect low-income individuals compared to high-income individuals?
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Which of the following is a component of aggregate demand?
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What does the aggregate supply refer to in an economy?
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Which formula can be used to calculate aggregate demand?
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Which term represents the use of government spending and tax policies to influence the level of demand in an economy?
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What does AD stand for in the context of calculating aggregate demand?
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