Effects of Positive/Negative Economic Growth
- Created by: William Ball
- Created on: 12-03-14 19:12
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- Effects of Economic Growth
- Benefits
- Living Standars
- People get paid more
- Wealth Effect
- Consumer Confidence
- No Jobs lost
- Profit
- Expand business
- Business Confidence
- More Investment
- Government revenue
- More tax revenue (Corperation and Income)
- Less expenditure from benefirs
- In the long run, Wealth will trickle down into lower incomes
- Living Standars
- Problems
- Enviroment
- More Conjestion
- More Pollution from increased energy consumption
- Increased use of RM
- BOP
- More money means imports from aborad
- Decrease In exports
- Firms will target the domestic market
- Self consumption of goods
- Inequality
- The increase in money will not be equally distributed
- Capitalist Society
- Inequality is helped by tax (redistributing money through tax and benefits)
- Inflation
- Increase in inflation - more uncertainty
- Decrease in the output gap
- As the economy approaches full capacity, shortages will occur
- Enviroment
- Benefits
- Recession
- Inverse of above with these additions
- Time lag
- Firms will not make redundancies until we are well into the recession
- This is because the economy fluctuates
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