At the end of 2015 the UK consumer price index was 258; at the end of 2016 it was 267. According to this information, the annual rate of inflation during 2016 was approximately:

The figure below depicts the aggregate demand and goods market equilibrium. Which of the following statements are correct?

Which of the following is a definite consequence of a high inflation rate?

Assuming that there is no government spending or trade, an economy’s aggregate demand is given by its domestic consumption (C) and investment (I), AD = C+ I= c_0+ c_{1}Y+ I. In the economy’s goods market equilibrium this equals its output: AD = Y. Solving for Y this yields: Y = [1/(1 - c_1)] (c_0 + I). Given this equation, which of the following statements is correct?

The central bank announces a rise in the official interest rate to reduce the rate of inflation. Looking at the figure shown, ceteris paribus, the aggregate investment function in these circumstances is likely to:

What happens to the aggregate demand curve when tax rate (t) falls?

What happens if we introduce a tax on consumption (you can think about a VAT type tax) with 20% tax rate in the WS–PS model?

When measured over time, the nominal value of many economic variables systematically grows more rapidly than their corresponding real values. Why might this be?

The figure shows that the severity of the business cycle has declined since 1945. Which of the following is most likely to have contributed to this moderation?

When a country’s GDP is being measured by the output method, the total figure comes to $500bn. When measured by expenditure, we have the following components: Households’ spending on consumption = $300bn, Firms’ spending on capital goods = $50bn, Government spending on services = $80bn, Government spending on capital goods = $ $50bn, Government transfers (social security etc) = $10bn, Exports = $10bn and Imports = $20bn. In the circumstances, how can we say the output and expenditure methods of calculating GDP are equivalent?