Macro application

Question 1

UK growth rate (2023)

Answer 1

0.1%

Question 2

Annual UK growth forecast for 2024

Answer 2

0.8%

Question 3

Uk output gap

Answer 3

-0.1%

Question 4

GDP per capita

Answer 4

£36,000

Question 5

Total GDP

Answer 5

£2.53 trillion

Question 6

Unemployment rate

Answer 6

4.2%

Question 7

Employment rate

Answer 7

74.5%

Question 8

Economic inactivity rate

Answer 8

22.2%

Question 9

Breakdown of uk gdp

Answer 9

79% in services
14% in manufacturing
6% in construction
1% in agriculture

Question 10

Wage growth in the UK? Why?

Answer 10

5.6% (positive in real terms). This is because of the inflation but also because of rising labour inactivity in the UK meaning that those in work have more bargaining power as these firms are struggling to hire workers.

Question 11

Is unemployment rising or falling

Answer 11

Rising

Question 12

Is our rate of unemployment above or below the natural rate of unemployment? What does this suggest?

Answer 12

It is above the natural rate of 3.5% which suggests cyclical unemployment.

Question 13

Why shouldn’t we trust these unemployment rates.

Answer 13

It was a dodgy labour force survey (LFS) which only looked at 15,000 people. Usually should be at least 100,000 people. We need to move to a more technically advanced LFS.

Question 14

Youth unemployment

Answer 14

11%

Question 15

What is the consumer confidence like right now

Answer 15

Very weak
-cost of living crisis
-worry about job security
-very high inflation
Currently have very weak retail sales, move from luxury to normal (income elasticity of demand)

Question 16

Why is this real wage growth a bad thing for the economy?

Answer 16

High wage growth will mean high underlying demand for goods and higher costs of production for firms who will then pass that onto the consumer via higher prices.

Question 17

What is happening to job vacancies right now?

Answer 17

The number is falling, the labour market is becoming looser.

Question 18

What is the target CPI rate of inflation.

Answer 18

2% +/- 1

Question 19

What is the current rate of CPI inflation

Answer 19

3.2%

Question 20

Is inflation going up or down currently

Answer 20

Going down

Question 21

What did inflation peak at in October 2022?

Answer 21

11.1%

Question 22

What is the producer price inflation (PPI)?

Answer 22

0.6%, very good as it is an indicator for future CPI falling. (It is the cost of a basket of goods that producers use to produce goods)

Question 23

What is the current account deficit?

Answer 23

3.2%

Question 24

What is the national minimum living wage?

Answer 24

£11.44 /hour

Question 25

What is causing the current account deficit.

Answer 25

There are underlying factors which keep this deficit high, these factors are structural weaknesses or supply side drivers of very poor competitiveness in the uk economy.

Question 26

Is productivity and investment good or bad at the moment.

Answer 26

It is very poor.

Question 27

Is the exchange rate strong or weak

Answer 27

Weak from £1=$1.60 pre brexit to £1=$1.24 now

Question 28

What is the budget deficit (2023-2024)

Answer 28

4.2% GDP

Question 29

What is the uk national debt.

Answer 29

98% of GDP

Question 30

What is the UK gini coefficient?

Answer 30

0.357 (has risen over last couple of years)

Question 31

What is the BoE base rate?

Answer 31

5.25%

Question 32

What is the average lending rate?

Answer 32

6.25%

Question 33

Do banks have a good or bad willingness to lend?

Answer 33

Good

Question 34

What is the savings ratio?

Answer 34

10.5%

Question 35

How much qualitative easing has been released into the UK economy?

Answer 35

£895bn