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The Macro Economy (Economic Growth (benefits of economic growth (improved…

- - - - average increase in GDP
      - If the real GDP / Capita Increases than on average people are having increased income
    - - GDP increases or decreases each year
    - - Real GDP / Capita = Real GDP accounted for population
  - - - Account of change in prices
- - - - increase in price of imports after Brexit
      - example: The Oil Price in the 1970's
  - - - Increase interest rate
    - - Increase taxes and lower public expenditure
- - - - Manufactures
        
        Cars
        
        Capital machinery
        
        Clothing
      - Primary goods
      - Commodities
        
        Gold
        
        Rice
        
        Grain
  - - - Financial
      - legal
      - accounting
      - HR
  - - - Surplus
        
        Effects
        
        Postive
        
        rising exports will generate employment and economic growth
        
        A nation can build up foreign currency reserves or lend money overseas
        
        Negative
        
        Domestic shortages if too many goods are sold abroad
        
        A rising exchange rate
        
        A rising exchange rate which will raise the prices of exports resulting in a fall in demand in the future
        
        If a country has a very high surplus it means that other countries deficits. This unbalanced situation could result in international stability.
      - Deficit
        
        Effects
        
        negative
        
        increased foreighn debt
        
        loss of jobs overseas
        
        currency depreciation
        
        positive
        
        increased consumption beyond PPC
- - - - E.g. Colorado ski/hike
  - - - Solutions
        
        Build roads and infrastructure
        
        Loose monetary policy (lowering interest rates)
        
        Expansionary fiscal policy
        
        Can replace consumption spending during a recession
  - - - can be solved with education and retraining
      - capital replacing humans
        
        E.g. Detroit 1950-present
        
        amazon robots
    - - E.g. South Wales unemployment
      - Also depends on seasons
      - Regions reliant on declining sectors - depressed
    - - Solutions
        
        re-training and education
        
        increased labour mobility
        
        learn skills for new jobs
      - rigid labour mobility
        
        little transferrable skills
      - in declining sectors workers are laid off
      - e.g. South Wales declining coal mining industry
    - - SUPPLY SIDE POLICY
        
        Education + Train
        
        increased labour mobility
        
        deals with sectoral unemployment
        
        Deregulation
        
        increases production
        
        increases supply
        
        reduces time for production
        
        Privatisation
        
        increases competition
        
        increases quality
        
        increases quality and quantity of supply
- - - - governments put taxes on those that damage the environment.
        
        the aim of taxation is to ensure that the social costs resulting from production and consumption are met by those who impose him.
        
        in some countries heavy taxes are put on petrol as it causes many environmental problems
    - - a range of legislation, regulations, guidelines and codes designed to help protect the environment
    - - the government can offer grants tax allowances and other subsidies
    - - pay for damages or extra costs
      - pays for double glazing when building airport near houses
    - - E.g. London Congestion charge 2003