measurement of macro performance

Question 1

what are the four main objectives?

Answer 1

• achieve economic growth and improve living standards and levels of economic welfare
• create and maintain full employment or low unemployment
• limit or control inflation, or to achieve some measure of price stability
• attain a satisfactory balance of payments, avoiding an external deficit which might create an echange rate crisis

Question 2

what is short-run economic growth?

Answer 2

when there are unemployed resources; movement from a point inside a PPF to a point on the PPF

Question 3

what is long-run economic growth?

Answer 3

outward movement of the PPF

Question 4

what does GDP measure?

Answer 4

measures the total value of all goods made, and services provided, during a specific period of time

Question 5

what is included in GDP?

Answer 5

goods and services. only final goods and services.