Macroeconomic Indicators Flashcards
What is a policy objective?
A target that the governments want to achieve
What are key government objectives?
Low and stable inflation
Sustained economic growth
Low unemployment
Favorable current account position on BOP
What are the other objectives?
Fairer distribution of income
Limit personal debt
Environmental Protection
Government Surplus
House prices rise
Balancing the Budget
What are objectives over time?
1945 - 1979 - Low Unemployment
1979 - 2000s - Low inflation
2008 - Present - Economic Growth, Reduced Unemployment
What are economic indicators?
Statistics that provide information about the economy.
What are lead indicators?
They provide info about the future state of the economy.
What are lag indicators?
They provide info about the past and present state of the economy.
What are examples of lead indicators?
Surveys of consumer and business confidence
House buildings stats
Investment and Employment intentions of firms
Commodity Prices
What are examples of lag indicators?
Inflation
Unemployment
Economic Growth
BOP
What’s “Real”?
Adjusted for inflation
What do index numbers allow?
Comparison of Data
What is base year?
100
Index equation = ?
(Current year value/ Index year value ) x100
Change in % = ?
(Change/original) x100
