Macro economic objectives (Economic Growth (Economic cycle- The periodic…
Macro economic objectives
use of scarce resources- decrease
government spending on benefits- increase
tax revenue- decrease
consumer confidence- decrease
business confidence -decrease
society- negative impact
Follows pattern of economic growth. High in a recession low in a boom.
between end of education or old job and new job
when entire industries close down
when production becomes more capital intensive
specific times of the year
When someone is without work but actively seeking job.
unemployment rate= number unemployed/ labour force x 100
A general decrease in the average prices of goods and services
A general increase in the average prices of goods and services.
wages- less value
exports- less price competative
business confidence- high
Rise in a boom: fall in a recession
When rising costs result in higher prices or smaller profit margins
when prices are driven up by a rise in demand
decrease in the value of savings
Impact of ...on
output< unemployment> household income< demand<
Living standards- low
output > unemployment < household income> demand>
Living standards- high
The periodic fluctuations of GDP in an economy over a period of time.
Boom- Output high (high confidence), Unemployment low (wages increase), Inflation high (increase demand)
Downturn- Output decreasing (growth possibly stops), Unemployment rises (rid of workers as concerned about future), Inflation slows down (demand starts to fall)
Recovery- Output increases (growth is positive), Unemployment decreasing (business gaining confidence), Inflation rising (but still be low)
Recession- Output decreases (6 month of negative growth), Unemployment rising (lack of demand for product), Inflation falling (prices may fall)
GDP (Gross Domestic Product)-
measurement of Economic growth.
Total market value of all final good and services produced within an economy.
Limitation of GDP as a measure of growth
PARALELL ECONOMY- Includes economic activity unrecorded by the government, includes black market ect.
NOT REAL- Cannot use to compare to other years as disregards inflation and price changes. Can change to real GDP to compare.
Increase in the total value of income, output or expenditure over a period of time.