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Macroeconomic objectives and theory — Question 7

QCAA 2020, Paper 1 · 1 mark

Q7 · 2020 · External assessmentUnclassified1 mark

QUESTION 7

Which statement does not describe a relationship between an cquitable distribution of income and economic growth?

(A) Higher aggregate supply leads to greater equality of income over time.

(B) Economic growth over time may reduce equality of income in market-based economies.

(C) Income inequality lowers aggregate demand due to the different propensities to consume.

(D) Some level of income inequality should encourage business investment and economic activity.

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