inflation

Question 1

interest rates were used as?

Answer 1

a mechanism to control inflation

Question 2

using interest rates to control inflation meant it raised to what in 1979?

Answer 2

raised to 17% in 1979

Question 3

downside of interest rates for businesses

Answer 3

higher interest rates made it more expensive for businesses to borrow

Question 4

what made it more difficult for business to export?

Answer 4

increased value of the pound

Question 5

high interest rates of early 1980s meant?

Answer 5

a decline in both output and demand

Question 6

The economy went into recession, what did this mean for business + result in?

Answer 6

meant many businesses went bankrupt = led to high unemployment

Question 7

inflation initially went up what did it peak at in May 1980?

Answer 7

peaked at 22%

Question 8

what did it reach in 1986?

Answer 8

reached a low of 2.5%

Question 9

attempts to control inflation in later 1980s, meant ?

Answer 9

further recession + eventual entry into the European Exchange Rate mechanism (ERM)

Question 10

by 1990 inflation had reached?

Answer 10

double figures again