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Chapter 18 - Coggle Diagram
Chapter 18
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the economy is dynamic
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a tax cut one time might have a larger impact than at other times depending on many other factors in the economy
Economic Activity
actions that involve the production, distribution and consumptions of goods/services
production can be primary, secondary or tertiary
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Circular Flow of Income
the continuous flow of income from businesses to households as payments for work, and from households to businesses as payment for products
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Leakages
income that 'leaks away' from the economy and so does not get passed back to UK firms from households; this compromises taxes, savings and imports
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government is interested in economic policy that creates a stable economy within which businesses can succeed
the government and BOE are trying to prevent potentially damaging effect of either huge fall or rise in GDP