Why is difficult to achieve both a low inflation rate and low unemployment level?
Inflation is controlled by using a contractionary policy which reduces AD and to reduce unemployment an expansionary policy is needed to increase AD
1 of 5
How can economic growth lead to negative externalities?
Expanding economies require increasing amounts of energy which can result in pollution or the depletion of non-renewable resources; increased transport and carbon emissions
2 of 5
Why are certain macroeconomic objectives politically unpopular?
Tax cuts can result in strain on the NHS or cuts in other sectors
3 of 5
What are two issues governments face in managing the macro-economy?
Time lags and external shocks
4 of 5
What is austerity?
Government expenditure cuts
5 of 5
Other cards in this set
Card 2
Front
How can economic growth lead to negative externalities?
Back
Expanding economies require increasing amounts of energy which can result in pollution or the depletion of non-renewable resources; increased transport and carbon emissions
Card 3
Front
Why are certain macroeconomic objectives politically unpopular?
Back
Card 4
Front
What are two issues governments face in managing the macro-economy?
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