The Effects Of Economic Growth and Tax Flashcards
How does economic growth affect the individual?
Economic growth causes an increase in the flow of money for the individual
This increased amount of money means individuals spend more.
How does economic growth affect towns and cities?
Towns grow as people move in.
More houses are built.
More services and businesses are set up.
How does economic growth affect the economy?
The government has more money to spend and can increase the amount of services and infastructure in the country.
The government can pay off debt.
The government can use grants to set up more businesses and improve the economy further.
How does economic decline affect the individual?
Loss of income, wages may be cut or employees let go because of redundancies.
As a result people spend less and more people go out of business with more and more people becoming unemployed.
How does economic decline affect towns/cities?
Emigration-people leave the town in search of work.
Lack of neccesary services and infastructure
How does economic decline affect the economy?
The government can’t afford to provide services and they are forced to make cutbacks.
They may have to borrow money.
Tax may also be increased.
How does tax affect the economy?
Provides current revenue for the government on a day-to-day basis to help run the country and provide essential services to the public.
