Paper 1 general

Question 1

How to reduce unemployment?

Answer 1

Short-Term: Expansionary fiscal (↑ spending, ↓ taxes), monetary policy (↓ interest rates).
Long-Term: Training & education, labour market reforms, hiring subsidies.

Question 2

How to reduce inflation?

Answer 2

Demand-Pull: Use contractionary fiscal (↓ spending, ↑ taxes) and monetary policy (↑ interest rates).
Cost-Push: Subsidies, supply-side improvements, currency appreciation.

Question 3

How to grow a country’s output (real GDP)?

Answer 3

Demand-Side: ↑ Govt spending, ↓ interest rates.
Supply-Side: Better education, infrastructure investment, R&D, trade liberalization.

Question 4

How to grow a country’s infrastructure?

Answer 4

Invest in public infrastructure, use PPPs, attract foreign aid/loans, streamline planning & regulation.

Question 5

How to help a country get out of a recession?

Answer 5

Stimulate demand (↑ spending, ↓ taxes, ↓ interest rates, depreciate currency).
Support long-term recovery (supply-side reforms, banking support, social safety nets).