Macroeconomic-Aims
What are the three main indicators of economic growth
GDP, employment rate, and inflation rate.
What is expansionary fiscal policy?
The government increases spending or reduces taxes to stable the economic growth.
What is monetary policy?
about monetary
What is the definition of inflation?
A general increase in prices.
Inflation is always harmful.（T/F）
F
If a country's unemployment rate continues to decline, does this mean the economy is growing?
No
When the government stimulates the economy by cuting the taxs what type fiscal policy is this?
Expansionary fiscal policy
What is the typical economic effect of raising interest rates?
It curbing the inflation.
What is the definition of deflation?
A decrease in prices.
If a country's economic growth rate continues to decline, what type of policy should the government adopt?
Fiscal and monetary policies.
Why is price stability important in macroeconomic?
Because it promotes investment and economic growth.
When the government rises the taxes on goods, what type of fiscal policy is this?
Contractionary fiscal policy.
What is the typical economic effect of lowering interest rates?
It promot a economic growth.
What are the effects of inflation on consumers and businesses?
Consumers' buying power decreases, and businesses' costs increase.
What is "stagflation"?
Economic growth stagnates while high inflation was a the sametime.
If a country's economic growth rate is negative, what does this usually indicate?
Recession.
If the government increas spending and cuts taxes at the same time, what will happen in the economy?
The economy will be stimulate or have a inflation.
How does the central bank control inflation through monetary policy?
By raising interest rates and reduc the printing money supply.
What are the potential risks of deflation to the economy?
It can lead to economic recession because consumers and businesses may not invest.
If a country's unemployment rate continues to rise, what does this mean?
Their economic was recessing.
How to assess a country's economic health in macroeconomic?
By assessing the economic growth, employment rate, inflation rate, and balance the tax.
During a recession, what type of fiscal policy should the government adopt?
Expansionary fiscal policy
If the economy is experiencing high inflation, what type of monetary policy should the central bank adopt?
Contractionary monetary policy
How can inflation be controlled through monetary policies?
By raising interest rates and reducing the money supply.
How can unemployment be solved through macroeconomic policies?
By using expansionary fiscal and monetary policies to creat job oppourtunities.