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# Assess the view that very low interest rates are good for the UK economy
- URL: https://www.a-level-economics-tutor.com/assess-the-view-that-very-low-interest-rates-are-good-for-the-uk-economy-2/
- Published: 2026-05-13T21:50:51.000Z
- Updated: 2026-05-13T21:50:55.000Z
- Author: Jaisul Naik
- Tags: AQA 25 mark question

### [AQA A-Level Economics Paper 2 June 2023 Insert](https://www.a-level-economics-tutor.com/content/files/2026/03/AQA-AS-Level-Economics-Paper-2-Insert-June-2023-1.pdf?ref=a-level-economics-tutor.com)

**Use the extracts and your knowledge of economics to assess the view that very low interest rates are good for the UK economy. (25 marks)**

**Plan**

- **Paragraph 1**
  - **Argument: on the one hand, low interest rates are good as they can stimulate investment**
  - **Diagram: right shift in AD and right shift in LRAS**
  - **Evaluation: liquidity trap**
- **Paragraph 2**
  - **Argument: on the other hand, low interest rates can be damaging as they cause inflation**
  - **Diagram: right shift in AD**
  - **Evaluation: depends on the state of the economy**

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