The Affluent Society Economic

Question 1

What are some economic issues in 1951?

Answer 1

Inflation and unemployment

Question 2

When did food rationing end?

Answer 2

1954

Question 3

When was the baby boom?

Answer 3

between 1951 and 1961

Question 4

How much did the population increase during the baby boom?

Answer 4

5%

Question 5

What led to virtually full employment in 1955?

Answer 5

consumer demand growing at home led to virtually full employment with only 200,000 unemployed

Question 6

Which industries grew rapidly?

Answer 6

Electronics, engineering, automotives and steel

Question 7

Which occupations fell of during this period?

Answer 7

Traditional occupations such as agriculture, fishing and coal mining fell off

Question 8

Do countries want imports to exceed exports or exports to exceed imports?

Answer 8

Countries want exports to exceed imports to encourage self sustainability

Question 9

What is ‘balance of payments’?

Answer 9

a good balance between imports and exports (want to export more than import)

Question 10

What are stop go economics?

Answer 10

Implementing a policy, seeing the effects and then changing it accordingly

Question 11

Why did wages rise?

Answer 11

High demand for labour so employers competing for workers

Question 12

What did wage increases do to the economy?

Answer 12

Inflation as rises in wages were outpacing the rate that production could increase so prices rise

Question 13

What is the Macmillan quote about spending in 1950s?

Answer 13

“What we need is restraint and common sense - restraint in the demands we make and common sense in how we spend our income” - Macmillan

Question 14

What is the difference between balance of trade and payments?

Answer 14

Trade refers to sum of exports and imports whereas payments includes all money going in and out of country (including aids and loans between countries)

Question 15

What does a Stop Phase lead to?

Answer 15

• Higher interest rates, policy of austerity
• Wage freeze
• Demand falls
• Short term impacts include falling imports, balance of payments steadies
• Longer term impacts include long falls in consumer demand, struggling business, dangers of unemployment, decrease in real wages, and higher levels of poverty

Question 16

What does a Go Phase lead to?

Answer 16

• Interest rates are cut encouraging borrowing and consumerism, wage increases and tax cuts.
• Increased demand, increased employment, thriving businesses, less poverty

Question 17

What is the purpose of a Stop Phase?

Answer 17

Increase exports and decrease imports to help the balance of payments

Question 18

What is the purpose of a Go Phase?

Answer 18

• Help businesses
• Increase employment
• Decrease poverty