CCEA BUSINESS STUDIES A2 UNIT 2
EXAM QUESTIONS AND ANSWERS.
VERIFIED 2025/2026.
Macro economics - ANS The study of the performance and behaviour of an economy as a
whole.
mixed economy - ANS An economic system that allows both the government and the private
sector to allocate resources, e.g. the UK has a mixed economy.
Business Cycle - ANS A measure of the regular fluctuations in the level of economic activity. It
is made up of the following elements: peak, recession, trough and recovery.
Gross Domestic Product (GDP) - ANS The value of goods and services produced by an
economy over a specific time period.
Peak (Boom) - ANS The stage when an economy is at the peak of activity.
Recession - ANS Income and output begin to fall and business confidence is reduced.
Trough (Slump) - ANS The lowest point in the trade cycle - production is low, businesses close
and unemployment is high.
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Recovery - ANS At this stage income will start to rise and business output will increase, firms
will invest more, consumers will start to increase spending and businesses will start to recruit
new workers.
Business Confidence - ANS An economic indicator that measures the amount of optimism or
pessimism that business managers feel about the prospects of their companies/organisations.
Government Policy Objectives - ANS A series of actions through which the authorities
attempt to create the best possible economic environment for business and individuals. The
main targets are: steady economic growth, controlled inflation, low unemployment, stable
exchange rates and a balanced balance of payments.
Economic Growth - ANS An indication of the change in output or income within the economy.
Sustainable Development - ANS Growth which continues year on year.
Inflation - ANS A continuing tendency for prices to rise.
Unemployment - ANS The number of people who are of working age but not in a job.
Balance of Payment - ANS An accounting record of all monetary transactions between a
country and the rest of the world
Current Balance - ANS The difference between the value of money entering and leaving a
country as a result of trade in goods services and transfers.
Imports - ANS Goods and services purchased from abroad for use in a particular country.
Exports - ANS Goods and services sold by a particular country to another country.
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
EXAM QUESTIONS AND ANSWERS.
VERIFIED 2025/2026.
Macro economics - ANS The study of the performance and behaviour of an economy as a
whole.
mixed economy - ANS An economic system that allows both the government and the private
sector to allocate resources, e.g. the UK has a mixed economy.
Business Cycle - ANS A measure of the regular fluctuations in the level of economic activity. It
is made up of the following elements: peak, recession, trough and recovery.
Gross Domestic Product (GDP) - ANS The value of goods and services produced by an
economy over a specific time period.
Peak (Boom) - ANS The stage when an economy is at the peak of activity.
Recession - ANS Income and output begin to fall and business confidence is reduced.
Trough (Slump) - ANS The lowest point in the trade cycle - production is low, businesses close
and unemployment is high.
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, Recovery - ANS At this stage income will start to rise and business output will increase, firms
will invest more, consumers will start to increase spending and businesses will start to recruit
new workers.
Business Confidence - ANS An economic indicator that measures the amount of optimism or
pessimism that business managers feel about the prospects of their companies/organisations.
Government Policy Objectives - ANS A series of actions through which the authorities
attempt to create the best possible economic environment for business and individuals. The
main targets are: steady economic growth, controlled inflation, low unemployment, stable
exchange rates and a balanced balance of payments.
Economic Growth - ANS An indication of the change in output or income within the economy.
Sustainable Development - ANS Growth which continues year on year.
Inflation - ANS A continuing tendency for prices to rise.
Unemployment - ANS The number of people who are of working age but not in a job.
Balance of Payment - ANS An accounting record of all monetary transactions between a
country and the rest of the world
Current Balance - ANS The difference between the value of money entering and leaving a
country as a result of trade in goods services and transfers.
Imports - ANS Goods and services purchased from abroad for use in a particular country.
Exports - ANS Goods and services sold by a particular country to another country.
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
