Please write clearly in block capitals.
Centre number Candidate number
Surname
Forename(s)
Candidate signature
I declare this is my own work.
AS
ECONOMICS
Paper 2 The National Economy in a Global Context
Monday 18 May 2026 Morning Time allowed: 1 hour 30 minutes
Materials For Examiner’s Use
For this paper you must have:
• the Insert Section Mark
• a calculator. A
B
Instructions
• Use black ink or black ball-point pen. Pencil should only be used for drawing. TOTAL
• Fill in the boxes at the top of this page.
• Answer all questions in Section A.
• Answer either Context 1 or Context 2 in Section B.
• You will need to refer to the Insert provided to answer Section B.
• You must answer the questions in the spaces provided. Do not write outside
the box around each page or on blank pages.
• If you need extra space for your answer(s), use the lined pages at the end of
this book. Write the question number against your answer(s).
• Do all rough work in this book. Cross through any work you do not want to be
marked.
Information
• The maximum mark for this paper is 70.
• The marks for questions are shown in brackets.
• No deductions will be made for wrong answers.
*jun *
IB/M/Jun26/G4004/V7 7135/2
, 2
Do not write
outside the
Section A box
Answer all questions in this section.
Only one answer per question is allowed.
For each question completely fill in the circle alongside the appropriate answer.
CORRECT METHOD WRONG METHODS
If you want to change your answer you must cross out your original answer as shown.
If you wish to return to an answer previously crossed out, ring the answer you now wish to select
as shown.
0 1 Which one of the following explains the difference between nominal income and
real income?
[1 mark]
A Nominal income is adjusted for inflation
B Nominal income is adjusted for population changes
C Real income is adjusted for inflation
D Real income is adjusted for population changes
*02*
IB/M/Jun26/7135/2
, 3
Do not write
outside the
0 2 Figure 1 shows the aggregate demand (AD) curve for an economy. box
Figure 1
Which one of the following would explain the change in the price level from P1 to P2 and
real national output from Y1 to Y2?
[1 mark]
A Increased energy costs
B Increased government spending
C Reduced employment
D Reduced indirect taxation
0 3 All other things being equal, which one of the following is most likely to occur in an
economy experiencing a period of deflation?
[1 mark]
A Firms buy a higher proportion of raw materials from abroad
B Firms replace capital goods earlier than necessary
C Households delay purchases of consumer durables
D Households experience increases in the cost of living
Turn over ►
*03*
IB/M/Jun26/7135/2
, 4
Do not write
outside the
0 4 Table 1 shows the annual growth rate in real gross domestic product (real GDP) in an box
economy between 2020 and 2024.
Table 1
Year 2020 2021 2022 2023 2024
Real GDP growth (%) –20% 15% 5% 3% 4%
The economy has a long-run trend rate of growth of 3% per year. At the start of 2020, it
was producing at its normal capacity level of output.
Which one of the following statements is supported by the data in Table 1?
[1 mark]
A The economy experienced an economic boom in 2021
B The economy had a positive output gap by 2024
C The economy had recovered to pre-recession real GDP by the end of 2022
D The economy had spare capacity in 2023
0 5 Which one of the following is an example of a supply-side policy?
[1 mark]
A A fall in indirect taxation to increase short-run aggregate supply
B A rise in direct taxation to reduce aggregate demand
C A subsidy to firms to cover an increase in the cost of capital goods
D A subsidy to households to cover an increase in energy prices
*04*
IB/M/Jun26/7135/2
Centre number Candidate number
Surname
Forename(s)
Candidate signature
I declare this is my own work.
AS
ECONOMICS
Paper 2 The National Economy in a Global Context
Monday 18 May 2026 Morning Time allowed: 1 hour 30 minutes
Materials For Examiner’s Use
For this paper you must have:
• the Insert Section Mark
• a calculator. A
B
Instructions
• Use black ink or black ball-point pen. Pencil should only be used for drawing. TOTAL
• Fill in the boxes at the top of this page.
• Answer all questions in Section A.
• Answer either Context 1 or Context 2 in Section B.
• You will need to refer to the Insert provided to answer Section B.
• You must answer the questions in the spaces provided. Do not write outside
the box around each page or on blank pages.
• If you need extra space for your answer(s), use the lined pages at the end of
this book. Write the question number against your answer(s).
• Do all rough work in this book. Cross through any work you do not want to be
marked.
Information
• The maximum mark for this paper is 70.
• The marks for questions are shown in brackets.
• No deductions will be made for wrong answers.
*jun *
IB/M/Jun26/G4004/V7 7135/2
, 2
Do not write
outside the
Section A box
Answer all questions in this section.
Only one answer per question is allowed.
For each question completely fill in the circle alongside the appropriate answer.
CORRECT METHOD WRONG METHODS
If you want to change your answer you must cross out your original answer as shown.
If you wish to return to an answer previously crossed out, ring the answer you now wish to select
as shown.
0 1 Which one of the following explains the difference between nominal income and
real income?
[1 mark]
A Nominal income is adjusted for inflation
B Nominal income is adjusted for population changes
C Real income is adjusted for inflation
D Real income is adjusted for population changes
*02*
IB/M/Jun26/7135/2
, 3
Do not write
outside the
0 2 Figure 1 shows the aggregate demand (AD) curve for an economy. box
Figure 1
Which one of the following would explain the change in the price level from P1 to P2 and
real national output from Y1 to Y2?
[1 mark]
A Increased energy costs
B Increased government spending
C Reduced employment
D Reduced indirect taxation
0 3 All other things being equal, which one of the following is most likely to occur in an
economy experiencing a period of deflation?
[1 mark]
A Firms buy a higher proportion of raw materials from abroad
B Firms replace capital goods earlier than necessary
C Households delay purchases of consumer durables
D Households experience increases in the cost of living
Turn over ►
*03*
IB/M/Jun26/7135/2
, 4
Do not write
outside the
0 4 Table 1 shows the annual growth rate in real gross domestic product (real GDP) in an box
economy between 2020 and 2024.
Table 1
Year 2020 2021 2022 2023 2024
Real GDP growth (%) –20% 15% 5% 3% 4%
The economy has a long-run trend rate of growth of 3% per year. At the start of 2020, it
was producing at its normal capacity level of output.
Which one of the following statements is supported by the data in Table 1?
[1 mark]
A The economy experienced an economic boom in 2021
B The economy had a positive output gap by 2024
C The economy had recovered to pre-recession real GDP by the end of 2022
D The economy had spare capacity in 2023
0 5 Which one of the following is an example of a supply-side policy?
[1 mark]
A A fall in indirect taxation to increase short-run aggregate supply
B A rise in direct taxation to reduce aggregate demand
C A subsidy to firms to cover an increase in the cost of capital goods
D A subsidy to households to cover an increase in energy prices
*04*
IB/M/Jun26/7135/2
