2.6.1

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Cards (8)

  • What are the four main macroeconomic objectives of the government?
    Economic growth, low unemployment, inflation stability, balance of payments
  • Why do governments in emerging markets prioritize economic development before economic growth?
    To improve living standards and literacy rates
  • What is the UK government's inflation target?
    2%, measured with CPI
  • What happens if the inflation rate falls 1% outside the target?
    The Governor must explain to the Chancellor
  • What does a balance of payments equilibrium on the current account indicate?
    The country can sustainably finance the current account
  • What is a balanced government budget aimed at ensuring?
    Control of state borrowing
  • Why is the protection of the environment a macroeconomic objective?
    To ensure long run environmental stability
  • What is the goal of greater income equality?
    To prevent extreme wealth gaps