Macroeconomic Objectives Flashcards
1
Q
4 Main Economic Objectives
A
- Economic Growth
- Unemployment
- Inflation
- Balance of Payments
2
Q
Economic Growth
A
- Rate of change of a country’s output.
- Key Measure is GDP.
3
Q
Low Unemployment
A
- Actively seeking work but unable to find a job.
- Unemployment is a waste of resources and an indicator of poor economic performance.
4
Q
Low Inflation
A
- The rate of change of average prices in an economy.
- Key Indicator is CPI or CPIH
- Target of 2% is independent of the UK government.
- Target for price stability is for it to be maintained within + or - 1% of the target.
5
Q
Balanced Balance of Payments
A
- Measures the UK’s economic activities with other countries.
- The UK has been in a significant deficit on the current account.
6
Q
Protection of the Environment
A
- Global warming and climate change high on the political agenda.
- The government look to develop a sustainable future.
7
Q
Greater Income Inequality
A
- Income inequality is regarded as socially unacceptable as a society people believe that all citizens should be able to access fair wages.
