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8 marksFiscal Policy

CAPE Economics Unit 2 · 2010 · Paper 2 · Question 4(c)

Discuss TWO reasons why fiscal policy may not work in practice in the small open economies of the Caribbean.

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Other parts of this question

  1. 4(a)Explain what is meant by 'automatic stabilizers', giving TWO examples of automatic stabilizers.[5 marks]
  2. 4(b)(i)Explain what is meant by the term 'fiscal policy'.[3 marks]
  3. 4(b)(ii)Outline THREE ways by which fiscal policy can be used by Caribbean governments to increase the level of employment and output in their economies.[9 marks]

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