Economics

Question 1

Economic growth

Answer 1

The total amount of goods and services produces in a country in a year

Question 2

How can a country achieve economic growth?

Answer 2

Keep inflation down

Keep interest rates down

Question 3

What is the FORMULA for calculating economic growth?

Answer 3

Increase in production
———————– X 100%
Last years production

Question 4

Advantages/ consequences of economic growth

Answer 4

Higher standard of living

employment- more money for workers

Question 5

Inflation

Answer 5

When more goods are produced in a country than another

Question 6

Formula for inflation

Answer 6

Increase in price
—————- X 100%
Previous year

Question 7

Causes of inflation

Answer 7

Demand on markets

Increase in taxes, wages, ect

Question 8

Advantages of low inflation

Answer 8

Good can be produced cheaply and it will be easier to sell them

Question 9

Benefits of low inflation to a consumer

Answer 9

Prices in shops are stable

Wage demands are lower

Question 10

Deflation

Answer 10

When prices are declining overtime

Question 11

When does deflation occur

Answer 11

When the annual inflation rate falls below zero percent