Economics 9708/22 — February/March 2023
Cambridge AS Level · AS Level Data Response and Essays · worked solutions for every part, with the mark scheme
Topics Price Stability · Fiscal Policy · Monetary Policy · Aggregate Demand and Aggregate Supply · Market Equilibrium and the Price Mechanism · Economic Systems · +8 more
Inflation in the United States (US)
Prices are rising much faster than expected across the world’s economies, including the US.
Content removed due to copyright restrictions.
Content removed due to copyright restrictions.
Some economists believe that interest rates in the US may need to rise from 0.25% to as high as 4.50% to ‘cool’ the economy and reduce the rate of inflation and that this is likely to happen sooner rather than later.
Source: Adapted from ‘Boom and doom?’, a briefing on inflation, The Economist 10 July 2021.
Using Fig. 1.1, compare the US inflation rate between July and December 2020 with that between January and June 2021.
Using the information provided, explain what is meant by ‘the US government’s economic stimulus package’.
Consider the extent to which an increase in interest rates could reduce the rate of inflation in the US.
With the help of an AD/AS diagram, assess whether the rising inflation rate in the US has been caused by changes to the demand side or changes to the supply side of the economy.
Assess the possible consequences of a rising rate of inflation for a country such as the US.
The rest of this paper
4 more questions- Q2Market Equilibrium and the Price Mechanism · Economic Systems · Reasons for Government Intervention in Markets20M
- Q3Income and Wealth Inequality · Methods of Government Intervention in Markets20M
- Q4The Circular Flow of Income · Economic Growth20M
- Q5Exchange Rates · Balance of Payments · Supply-Side Policy20M