managing the UK economy
- Created by: brandss
- Created on: 13-05-16 11:18
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- Managing the Economy - 4 principals
- Inflation
- a sustained increase in the general level of prices
- HIGH =
- cost of living increase
- wage price spiral
- Low internation competitiveness
- cost of living increase
- LOW =
- deflation
- people spend less in antricipation for prices to fall futher
- even slower growth
- people spend less in antricipation for prices to fall futher
- slowing growth rate as spending declines
- new tech increases efficiency
- lower prices and lower inflation
- competitive export prices
- deflation
- Reduced unemployed ment
- high unemployment = increase taxes
- paying out benefits but loosing income revenue
- labour is derived. only need what you demand (measure of successfulness)
- sustained eco growth
- Real V Nominal
- N = includes ifnlation
- R = excludes inflation
- leads to increased output and inflation
- Inflation
- a sustained increase in the general level of prices
- HIGH =
- cost of living increase
- wage price spiral
- Low internation competitiveness
- cost of living increase
- LOW =
- deflation
- people spend less in antricipation for prices to fall futher
- even slower growth
- people spend less in antricipation for prices to fall futher
- slowing growth rate as spending declines
- new tech increases efficiency
- lower prices and lower inflation
- competitive export prices
- deflation
- Inflation
- increase living standards
- desire both actual and potential
- A = increase in output
- P = increase in capacity
- Real V Nominal
- Balance of payments
- want it at 0
- want a surplus
- small surplus = more int competitive
- big suplus = a deficit in another country
- your surplus = where you have comparative advantage
- Inflation
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