Module 17 - The macroeconomic environment Flashcards
State the six main macroeconomic objectives
.
Give examples of macroeconomic policy instruments
.
Explain how financial well-being of the country can be analysed
.
Net worth
.
Consumption of domestically produced goods and services
.
Net savings
.
Net taxes
.
Transfer payments
.
Imports
.
Withdrawals
.
Investment
.
Government expenditure
.
Exports
.
Injections
.
Aggregate demand
.
Explain why planned withdrawals need not equal planned injections
.
Explain the effect of an increase in injections on the main macroeconomic objectives
.
Value added
.
Gross domestic product (GDP) at market prices
.
Gross value added (GVA) at basic prices
.
Gross national income (GNY) at market prices
.
Net national income (NNY) at market prices
.
Households’ disposable income
.
State the two conditions for equilibrium national income
.
Explain how equilibrium national income is restored if the economy is not initially at equilibrium
.
Explain the effect of a change in injections or withdrawals on the equilibrium level of national income
.
Explain why a change in injections has a multiplier effect on national income
.
Marginal propensity to consume domestically produced goods and services
.
The multiplier
.
The principle of cumulative causation
.
Actual growth rate
.
Potential growth rate
.
Potential output
.
Full-capacity output
.
Output gap
.
Human capital
.
Knowledge spillovers
.
Describe the four phases of the business or trade cycle
.
State the main determinants of the actual growth rate
.
State the two main determinants of the potential growth rate
.
Discuss the main factors that contribute to a country’s growth
.
Discuss the policies that a government could introduce to stimulate economic growth
.
Unemployed
.
Labour force
.
Unemployment rate
.
Standardised unemployment rate
.
Claimant count
.
Aggregate demand for labour
.
Aggregate supply for labour
.
Equilibrium (or natural) level of unemployment
.
Disequilibrium unemployment
.
Frictional (or search) unemployment
.
Structural unemployment
.
Technological unemployment
.
Regional unemployment
.
Seasonal unemployment
.
Demand-deficiency (or cyclical) unemployment
.
Real-wage unemployment
.
Discuss the main costs of unemployment
.
Discuss the main causes of unemployment
.
Discuss possible policies to reduce unemployment
.
Rate of inflation
.
GDP deflator
.
Menu costs
.
Demand-pull inflation
.
Cost-push inflation
.
Distinguish between nominal figures and real figures
.
Explain the shapes of the AD and AS curves
.
Discuss the costs and benefits of inflation
.
Discuss the problems caused by deflation
.
Discuss the causes of inflation
.
Discuss the possible policies to reduce inflation
.
