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External environment - Role of the Bank of England
Theories
In this section, we look at theories relating to fiscal policy, monetary policy and supply-side policy. All these policies are used extensively by government to try to achieve a myriad of aims and objectives, but they need to be used carefully to ensure the right outcome.
Choose the theory you would like to look at below:
- Effects of interest rates - monetary policy is the key short to medium-term tool of economic management, but what impact do changes in interest rates have on businesses and the rest of the economy?
- Impact of interest rates on demand - how will changes in interest rates affect the level of demand in the economy and why?
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