Economics (AS & A Level) · Oct / Nov 2025 · Paper 12 · Question 23

A country has a target rate of inflation of 2.5% and has recently experienced the actual rate rising to 6%, with unemployment falling to very low levels. Which policy option is most likely to be implemented?

1. Aan increase in government expenditure on training
2. Ban increase in indirect taxes on demerit goods
3. Can increase in import tariffs
4. Dan increase in interest rates

As printed in the paper