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3 marksMonetary Theory and Policy

CAPE Economics Unit 2 · 2012 · Paper 2 · Question 3(c)

Explain how expansionary monetary policy may be used, instead of fiscal policy, to increase employment in the economy.

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Other parts of this question

  1. 3(a)(i)Distinguish between 'unemployment' and 'underemployment'.[4 marks]
  2. 3(a)(ii)Outline FOUR types of unemployment.[8 marks]
  3. 3(b)(i)With the use of examples, describe TWO types of inflation.[6 marks]
  4. 3(b)(ii)Differentiate between 'nominal interest rate' and 'real interest rate'.[4 marks]

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