Economics (AS & A Level) · May / June 2022 · Paper 13 · Question 30

A country is suffering from severe deflation. What is most likely to prevent the deflation from worsening?

1. Aincreasing income tax to help reduce the government's budget deficit
2. Bincreasing interest rates to encourage more saving
3. Cincreasing transfer payments to reduce inequality of income
4. Drevaluing the currency to bring in more revenue from exports

As printed in the paper