Social Science (087) — AI-generated practice question

Economists and politicians drew two key lessons from inter-war economic experiences:

First, an industrial society based on mass production cannot be sustained without mass consumption, which requires high and stable incomes. Stable incomes need full employment, and since markets alone cannot guarantee this, governments must intervene to minimise fluctuations in price, output, and employment.

Second, full employment could only be achieved if governments had the power to control flows of goods, capital, and labour across borders, recognising the importance of managing a country's external economic links.

Source: Chapter 3, Section 4.1 — Post-war Settlement and the Bretton Woods Institutions

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• The examiner expects both lessons clearly stated — missing either one costs marks.
• Key phrases to include: "mass production needs mass consumption," "full employment," "government intervention," and "control over flows of goods, capital and labour."
• Don't just list; briefly explain the reasoning behind each lesson (e.g., why stable incomes require full employment). This shows understanding and fetches full marks.
• These two lessons directly explain why Bretton Woods institutions were designed the way they were — linking them shows higher-order thinking if space allows.