Question 4 a) The UK Government wants to prioritise increase economic growth and employment in the economy. To support this the government decides to reduce the rate of income tax. Using your knowledge of macroeconomics explain the affect this could have on the macroeconomic variables and any policy conflict that may occur. Ensure that you utilise Aggregate Demand and Aggregate Supply Diagrams to support your explanations. (10 Marks) b) The Central Bank wants to reduce the rate of inflation. To achieve this, the Central Bank decides to increase the interest rate. Using your knowledge of macroeconomics explain the affect this could have on the macroeconomic variables and any policy conflict that may occur. Ensure that you utilise Aggregate Demand and Aggregate Supply Diagrams to support your explanations. (10 marks) c) Explain the relationship between inflation and unemployment according to the long-run Phillips Curve. (10 marks) d) It can be hard to find jobs for those who are structurally unemployed because: i. they typically do not meet the qualifications or skillsets required for the available jobs ii. the economy is in a recession/a downturn they voluntarily quit their last jobs and employers may view them as unreliable iv. there are seasonal factors affecting their employment Please select the answer that you believe best addresses the statement. Please ensure that you provide a clear rationale for your