Study Terms Flashcards
Employment levels
All the Labour Force which is all working people. If more people are working the economy is doing good and income is higher
Interest rates
Interest rates are The cost of borrowing money expressed as a percentage of the amount borrowed or they are rewarded for money saved. IF the interest rate is high there will be less borrowing and spending and if its bow there will be more borrowing and Spending.
National debt
The total amount of money that a countries goverment has borrowed. Tax may incense because of it and people will have to buy less goods and servees. Which is bad for businesses
National income
Is the tatal value of all new goods and services producted within a Country in a year.
Economic growth
Occurs when there is an increase in quality of goods and services produced from one year to the next
Inflation
Inflation is a sustained increase in the general level of prices of goods and services from one year to the next.
Impact of high inflation on households
Inflation reduces the purchasing power of money. Higher prices means that consumers will not be able to buy as many goods and services, which will result in a lower standard of living.
Inflation may stop people saving money if the rate of interest they earn on savings is less than the rate of inflation.
Impact of high inflation on businesses
Workers may demand wage increases so that they can afford the same amount of goods and services as they did before inflation.
Rising business costs will discourage expansion and investment.
Impact of high inflation on the economy
Irish-made goods and services will be more expensive and it will become more difficult to sell them abroad. This may result in job losses and rising unemployment.
Government spending may increase due to rising costs and increased social protection payments.
