IBDP Economics SL – Macroeconomics – Demand management—fiscal policy -Paper 2 Exam Style Practice Questions
Demand management—fiscal policy Paper 2?
Exam Style Questions..
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IBDP Economic SL- All Topics
Exam Style Question for Demand management—fiscal policy -Paper 2
Question
Using an AD/AS diagram, explain how expansionary fiscal policy has supported economic growth in Cameroon (Text D, paragraph 3).
▶️Answer/Explanation
For an AD/AS diagram showing a shift of the AD to the right and an increase in the real GDP AND an explanation that expansionary fiscal policy implies that government spending is increasing (and/or that lower taxes would increase consumption and investment) which is (are) a direct component(s) of AD and this would lead to an increase in real GDP (economic growth).
