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12 Cards in this Set
- Front
- Back
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What is meant by a macroeconomic objective? |
An objective that relates to the economy as a whole rather than a specific sector or a individual company. |
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What are the 4 key macroeconomic objectives that the UK wants to achieve? |
Price stability, low unemployment, a balance of payment equilibrium and satisfactory economic growth. |
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What is a potential negative consequence of expanding economic growth to reduce unemployment? |
Measures taken to expand the economy (E.G reducing interest rates and taxation) Increase the demand for goods and services which is likely to result in a rising inflation |
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All governments aim to achieve zero inflation. True or false? |
False. Target it 2%. With a max difference of 1% either side. Measured by consumer price index |
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What does disinflation mean? |
Prices are raising but more slowly than previously. |
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In June, the monetary policy committee (MPC) decides to raise the bank rate by half a percent point. In August, Paul and Amanda's mortgage payments increased. Explain how these two events are likely to be linked? |
Paul and Amanda must have a variable rate mortgage, so the amount they pay each month is likely to rise and fall broadly in line with changes in the bank rate. |
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How would the government achieve a budget surplus? |
Increase taxation. Reduce public spending |
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EU legislation being introduced at the same time and exactly the same way across all member states. This indicates the legislation is a form of: |
Regulation |
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Which UK body and which EU body response for monitoring the financial system for systematic risk and taking steps to reduce it? |
The Bank of England for the UK The European systematic risk board for the EU (ESRB) |
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What best describes EU directives? |
Describe the required outcome but leave member states decide how they achieved. |
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What is the maximum number of times a Bank of England base rate can change in 12 months. |
8 times |
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Do you run the recovery and expansion phase of the economic cycle, share prices are most likely to; |
Increase |
