Podcast
Questions and Answers
What is the most direct consequence of increased prices on economic growth?
What is the most direct consequence of increased prices on economic growth?
- Improved price stability
- Increased resource costs (correct)
- Increased consumer spending
- Higher employment rates
How does full employment conflict with price stability?
How does full employment conflict with price stability?
- Increased employment raises income and pressures prices. (correct)
- Higher employment leads to increased spending.
- Full employment results in lower prices.
- Low employment decreases resource allocation efficiency.
Which of the following factors promotes economic growth through resource efficiency?
Which of the following factors promotes economic growth through resource efficiency?
- Decreased wages
- Limited consumer choice
- Full unemployment
- High demand for labor (correct)
What is a negative effect of having more imports than exports on the economy?
What is a negative effect of having more imports than exports on the economy?
How does economic freedom relate to productivity?
How does economic freedom relate to productivity?
What is the relationship between environmental stewardship and economic growth?
What is the relationship between environmental stewardship and economic growth?
What effect does employed worker spending have on economic growth?
What effect does employed worker spending have on economic growth?
Which of the following accurately describes the role of technology in relation to employment?
Which of the following accurately describes the role of technology in relation to employment?
How does political stability relate to economic growth?
How does political stability relate to economic growth?
What is one outcome of achieving reduced public debt?
What is one outcome of achieving reduced public debt?
Which statement correctly describes the relationship between economic growth and public debt?
Which statement correctly describes the relationship between economic growth and public debt?
How does increased productivity and efficiency affect the economy?
How does increased productivity and efficiency affect the economy?
What is a consequence of equitable distribution of income?
What is a consequence of equitable distribution of income?
What impact does economic decay have on resource availability for businesses?
What impact does economic decay have on resource availability for businesses?
Which of the following pairs represents complementary economic goals?
Which of the following pairs represents complementary economic goals?
What does price stability signify for the economy?
What does price stability signify for the economy?
Which economic goal is negatively affected when public debt increases?
Which economic goal is negatively affected when public debt increases?
How does competition for resources affect price stability?
How does competition for resources affect price stability?
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Study Notes
Economic Goals
- Every political system attempts to establish economic goals to focus the use of productive resources.
- Reaching one goal can make another goal easier to achieve (complementary) or more difficult to achieve (conflicting).
- Political stability is key as a stable government helps with long-term planning and investment, guaranteeing consistency in using resources.
- A stable government encourages economic growth as uncertainty decreases investment.
- Reduced public debt is vital to allow governments to invest in the economy and have money for future projects.
- Economic growth is the increase in the total production of goods and services in the economy. Increased growth provides more opportunities, new resources, skilled labour, and innovation.
- Increased productivity and efficiency is when resources are maximized to enhance profit and economic growth.
- Equitable income distribution involves dividing the national output fairly, which can be difficult to achieve due to various opinions on "fair".
- Price stability involves having a stable price level, not too high (inflation) or too low (deflation).
- Full employment is a key goal to ensure adequate spending and a thriving economy.
- A viable balance of payments and a stable currency are essential for healthy international trade.
- Economic freedom allows for consumer choice, savings, and investments.
- Environmental stewardship involves responsible use of natural resources, considering the interests of current and future generations.
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