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Cambridge IGCSE Business Studies practice

Paper 1 structured question: Economic issues

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Attempt questionEconomic issues revisionRevise the key idea

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Economic issues

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Paper 1Short Answer and Data Response3 marks

The government is planning to reduce interest rates to stimulate economic growth.

Description

Effects of Interest Rate Reduction

The government has announced a plan to reduce interest rates in an effort to stimulate economic growth. This policy aims to encourage borrowing and investment by businesses and consumers alike.

  1. a

    Explain how a reduction in interest rates might affect business investment.

    Aim for approximately 3 distinct marking points.

    [3]

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Paper 1 structured question: Economic issues

Paper 1Short Answer and Data Response1 marks

Description

Impact of Tax Increase on Businesses

The government has announced a tax increase on corporate profits. This decision aims to generate additional revenue for public services, such as healthcare and education. Businesses are concerned about how this will affect their profitability and investment strategies.

  1. a

    State one potential impact of the tax increase on businesses.

    Aim for approximately 1 distinct marking point.

    [1]