Fill in the Blanks How effective are these policies?Online version Analyse which policy the statement talks about. by Gilma Montecer 1 Raising taxes may also have adverse side effects . They lower demand , which may increase unemployment and slow economic growth . This represents the effectiveness of : . 2 Imposing tariffs against fellow members of a trade bloc is not an option . Imposing or increasing tariffs against other countries involves two risks . One is that it may provoke retaliation and the other is that it may reduce the pressure on domestic firms to become more efficient . This represents the effectiveness of : . 3 This policy may alter a country ? s current account position in the short term but are unlikely to be a long - term solution . This represents the effectiveness of : . 4 This policy can be difficult to control . This is partly because commercial banks have a strong incentive to try to increase their lending and may seek to get round any limits a central bank seeks to impose on the growth of their lending . This represents the effectiveness of : . 5 As with fiscal policy measures , this policy measures are not likely to be an effective long - term solution to balance of payments problems . The one exception may be a government deciding to stop maintaining an exchange rate that is set above or below the market value . This represents the effectiveness of : . 6 policy measures may reduce a current account deficit and a financial account deficit by making domestic products more price competitive and by making domestic markets more to in . This represents the effectiveness of : supply side policy . 7 Some measures , for example increased spending on education , may not be very effective in the short term as they can take a long time to have an effect . This represents the effectiveness of : . 8 Privatisation may not result in an increase in efficiency if the privatised industries become monopolies and do not take into account external costs and benefits . This represents the effectiveness of : . 9 Providing subsidies to firms may not always result in lower prices of domestically produced products . This is because the firms may not pass on the subsidies to consumers and the payment of subsidies may make the firms complacent . This represents the effectiveness of :
New game