AQA ECON4 June 23rd

**** you're my twin- I did the exact same questions - imma say my answer but you should know there is no right answer so calm down

context 2
supply side- training skills stop structural unemployment
evaluation- time lag , UK debts and EU referendum threatening AAA credit rating
Demand side - cut tax - stimulate demand consumer spending driver of econ growth but may not work as rational households may save knowing there will be a higher tax to pay in the future to finance these cuts
Demand side cut interest rate - but interest rates been 0.5% since 2009 etc can't be any lower and don't know if banks will pass it on
conclusion for demand side

essay 2
1effect on balance payment - worsen cause inflation below might seem as the uk being week place to invest therefore stop inward FDI UK benefits a lot from it 31198 jobs in 2014 alone
2 effects on gdp cheaper prices more dispable income more spending econ growth more demand
3 effect o employment good as cheaper price more disposable income more demand, therefore, greater demand for labour - however extreme deflation can have opposite effects , people might see prices are going down and wait so firms will push prices down at the expense of workers
4 increase inequality as increase in debt burden, therefore, uk debt more expensive therefore govt will need to cut more govt projects
conclusion
depends on magnitude and causes

good we had mostly the same answer, I think I forgot to explicty say structural unemployment though