a) Policies

• define demand-side policies

• state the two types of demand-side policies

• policies aimed at shifting AD

• monetary policy + fiscal policy

• define monetary policy

• define fiscal policy

• the use of interest rates and the money supply to shift AD

• the use of government expenditure and taxation to shift AD

• describe the setting of the monetary policy

• describe the setting of the fiscal policy

• set by the the Bank of England Monetary Policy Committee eight times a year

• set by the government → introduced to the public in the government budget once a year

• define expansionary demand-side policy

• state the enacted policies

• policy aimed at increasing AD

-

• decreasing the interest rate

• increasing quantitative easing

• increasing government expenditure

• decreasing taxation

• define contractionary demand-side policy

• state the enacted policies

• policy aimed at decreasing AD

-

• increasing the interest rate

• decreasing quantitative easing

• decreasing government expenditure

• increasing taxation