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Economics (AS & A Level) · May / June 2025 · Paper 11 · Question 23

9708Monetary policy

A government uses expansionary monetary policy over a three-year period. Which combination identifies the likely impact of such a policy?

  1. Areal GDP falling; price level rising; unemployment falling
  2. Breal GDP rising; price level rising; unemployment rising
  3. Creal GDP rising; price level rising; unemployment falling
  4. Dreal GDP rising; price level falling; unemployment rising

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Correct answer: C. real GDP rising; price level rising; unemployment falling

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