2.1 Measures of economic performance

Question 1

a) Rates of change of real Gross Domestic Product (GDP) as
a measure of economic growth

Question 2

b) Distinction between:
o real and nominal
o total and per capita
o value and volume

Question 3

c) Other national income measures:
o Gross National Income (GNI)

Question 4

d) Comparison of rates of growth between countries and
over time

Question 5

e) Understanding of Purchasing Power Parities (PPPs) and
the use of PPP-adjusted figures in international
comparisons

Question 6

f) The limitations of using GDP to compare living standards
between countries and over time

Question 7

g) National happiness:
o UK national wellbeing
o The relationship between real incomes and subjective
happiness

Question 8

a) Understanding of:
o inflation
o deflation
o disinflation

Question 9

b) The process of calculating the rate of inflation in the UK
using the Consumer Prices Index (CPI)

Question 10

c) The limitations of CPI in measuring the rate of inflation

Question 11

d) The Retail Prices Index (RPI) as an alternative measure
of the rate of inflation

Question 12

e) Causes of inflation:
o demand pull
o cost push
o growth of the money supply

Question 13

f) The effects of inflation on consumers, firms, the
government and workers

Question 14

a) Measures of unemployment:
o the claimant count
o the International Labour Organisation (ILO) and the
UK Labour Force Survey

Question 15

b) The distinction between unemployment and
under-employment

Question 16

c) The significance of changes in the rates of:
o employment
o unemployment
o inactivity

Question 17

d) The causes of unemployment:

Answer 17

o structural unemployment
o frictional unemployment
o seasonal unemployment
o demand deficiency and cyclical unemployment
o real wage inflexibility

Question 18

e) The significance of migration and skills for employment
and unemployment

Question 19

f) The effects of unemployment on consumers, firms,
workers, the government and society

Question 20

a) Components of the balance of payments, with particular
reference to the current account, and the balance of
trade in goods and services

Question 21

b) Current account deficits and surpluses
Expl. Causes. Effects.

Question 22

c) The relationship between current account imbalances
and other macroeconomic objectives

Question 23

d) The interconnectedness of economies through
international trade

Question 24

inflation EVALUATION

Question 25

foreign direct investment evaluation