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EconomicsEdexcel (9EC0)Macroeconomics

Macroeconomics & Inflation — Edexcel Economics

Edexcel A-Level Economics

Macroeconomics is a major component of Edexcel A-Level Economics (Theme 2 and Theme 4). This interactive tool models the AD/AS framework — shift aggregate demand and aggregate supply curves to explore the impact on output, employment, and the price level. Investigate causes of inflation (demand-pull and cost-push), deflation risks, the Phillips curve trade-off, fiscal policy (government spending and taxation), and monetary policy (interest rates and quantitative easing). Includes practice scenarios aligned to Edexcel data-response and essay questions.

Uses Google Fonts (Cormorant Garamond, Inter Tight). Requires an internet connection for full styling.

Frequently asked questions

What is the difference between demand-pull and cost-push inflation?+
Demand-pull inflation occurs when aggregate demand increases faster than aggregate supply — too much money chasing too few goods. Cost-push inflation occurs when costs of production rise (e.g. oil prices, wages), shifting the AS curve to the left and pushing up the price level.
How does monetary policy control inflation?+
The central bank (Bank of England) uses the base interest rate as its primary tool. Raising interest rates increases the cost of borrowing, reduces consumer spending and business investment, and decreases aggregate demand — which reduces inflationary pressure. The MPC targets 2% CPI inflation.

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