Economics (AS & A Level) · May / June 2024 · Paper 11 · Question 18
9708Aggregate Demand and Aggregate Supply analysis
A major trading nation, country X, is in equilibrium at the full employment level of real output. There is then a recession in its main international markets. What are the most likely consequences of this change for country X?
- Adecrease rate of inflation, decrease unemployment
- Bdecrease rate of inflation, increase unemployment
- Cunchanged rate of inflation, decrease unemployment
- Dunchanged rate of inflation, increase unemployment
As printed in the paper
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Correct answer: B. decrease rate of inflation, increase unemployment
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