Memorsing content can only take you so far, so use exam questions effectively to prepare yourself for the actual exam. This document will help you do so, it contains exam questions for this spec point. [A Level Economics Edexcel A, Exam Questions]
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Question 1a
The planned investment in the redevelopment of Dover Port will cost £115 million. The Chief Executive said it will lead to many
‘new job opportunities for local people and a transformed waterfront experience’ with new cafés, bars, and shops.
(Source adapted from: https://www.kentonline.co.uk/dover/news/docklands‑redevelopment‑work‑to‑start‑118581/)
(a)
If the value of the multiplier is 8, which one of the following will be the total increase in GDP from the redevelopment,
assuming other things are equal?
A. £64 million
B. £115 million
C. £207 million
D. £230 million
[1 mark]
Question 1b
(b)
Using the example above, explain how the multiplier process leads to an increase in aggregate demand.
[4 marks]
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