What this practice covers
These questions are drawn from past CIE 9708 papers and filtered to monetary policy. You answer, you find out immediately whether you were right, and you get the reasoning for the correct option and for each distractor. Wrong answers go to a mistakes locker so you can come back to exactly those.
Practice is free. You need an account only so your progress and your mistakes are still there next time.
Start practising Paper 1 MCQs →
What examiners see students get wrong here
These are the errors that cost marks on monetary policy, taken from our own topic notes. Read them before you practise and you will recognise the traps in the questions.
- “Monetary policy means only changing interest rates.”
- “A lower interest rate always increases borrowing.”
- “The central bank sets every interest rate in the economy.”
- “More money automatically creates the same percentage increase in real output.”
- “Expansionary monetary policy shifts LRAS right.”
- “Contractionary policy lowers all prices.”
- “Devaluation is always a monetary-policy tool.”
Revise it first
If any of the above is unfamiliar, work through the notes before practising: Monetary Policy revision notes.