2.6.1 Possible Marcoeconomic Objectives ✅

Question 1

What are supply side policy’s for?

Answer 1

Increase productive capacity. (LRAS right).

Question 2

What are possible macroeconomic objectives?

Answer 2

• economic growth
• Low inflation
• low unemployment
• environmental protection
• income inequality
• balance gov budget
• balance of payment equilibrium on current account

Question 3

How are these policies achieved?

Answer 3

Management of demand and supply. (Monetary and fiscal for demand policies).

Question 4

What do they do to demand in a recession?

Answer 4

Stimulate it for lower unemployment and growth.

Question 5

What do they do to demand in a boom.

Answer 5

Decrease demand to decrease inflationary pressures.