2.1 Introductory Lesson - Macro Quiz Flashcards
Who sets the interest rates in the UK and what is the current interest rate?
The Monetary Policy Committee sets the interest rates in the UK and the current base interest rate is 4%
What is the population of the UK and the unemployment rate?
The population of the UK is approximately 66.65 million and the unemployment rate is 3.7%.
Where can I find data on inflation, unemployment, etc. in the UK?
Data on inflation, unemployment, etc. in the UK can be found on https://www.ons.gov.uk.
Who is the Chancellor of the Exchequer?
Jeremy Hunt is the Chancellor of the Exchequer.
Is the pound stronger or weaker against the US dollar compared to 10/15 years ago, and who does it benefit or harm?
The pound is stronger against the US dollar compared to 10/15 years ago, which benefits the UK and harms the US.
What are the purposes of taxes?
The purposes of taxes are to raise revenue for government expenditure and to redistribute wealth throughout the country.
What is the target rate of inflation and what is inflation?
The target rate of inflation is 2% and inflation is the increase in prices every year.
Why is a 0% or negative inflation rate bad for an economy and what is the difference between benign deflation and malign deflation?
A 0% or negative inflation rate is bad for an economy because it discourages people from buying goods, leading to lower demand, which could result in business cuts, layoffs, and rising unemployment. Benign deflation is a controlled fall in prices due to increased productivity, while malign deflation is an uncontrolled fall in prices due to reduced demand.
Why does the government provide goods like education and healthcare free of charge, but taxes heavily goods such as alcohol, cigarettes etc.?
The government provides education and healthcare for free because these are considered as basic human needs and the government has an obligation to ensure that every citizen has access to quality education and healthcare. On the other hand, goods such as alcohol and cigarettes are taxed heavily because they are harmful to health and can cause long-term health problems. By taxing these goods, the government can discourage people from consuming them and generate revenue to fund public services.
