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EnglandEconomics

Macroeconomics: Macroeconomic objectives and indicators

5 dot points across 5 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

How is economic growth measured, what causes it, and how does it move through the business cycle?

Economic growth and the business cycle: the measurement of GDP and growth, real versus nominal and per-capita measures, the causes of short-run and long-run growth, the phases of the business cycle, and the costs and benefits of growth.
An Eduqas A520 answer to economic growth, covering how GDP and growth are measured, real versus nominal and per-capita GDP, the causes of short-run (actual) and long-run (potential) growth, the four phases of the business cycle and output gaps, and the costs and benefits of economic growth.
12 min answer →

How is inflation measured, what causes it, and why do inflation and deflation matter?

Inflation and deflation: the measurement of inflation using a price index, demand-pull and cost-push causes, the effects of inflation and deflation, and the distinction between inflation, disinflation and deflation.
An Eduqas A520 answer to inflation and deflation, covering the measurement of inflation through a weighted price index such as the Consumer Prices Index, demand-pull and cost-push causes, the costs of inflation and of deflation, and the difference between inflation, disinflation and deflation.
12 min answer →

What does the balance of payments record, and why does a persistent current-account deficit matter?

The balance of payments and the current account: the structure of the balance of payments, the components of the current account, the causes and consequences of a current-account deficit or surplus, and the link to other objectives.
An Eduqas A520 answer to the balance of payments, covering its structure (current, capital and financial accounts), the four components of the current account, the causes and consequences of a current-account deficit or surplus, and how external balance interacts with growth, the exchange rate and other macroeconomic objectives.
12 min answer →

What causes inequality in income and wealth, and how can governments influence the distribution?

The distribution of income and wealth: the difference between income and wealth, the causes of inequality, the costs and benefits of inequality, and the policies governments use to redistribute.
An Eduqas A520 answer to the distribution of income and wealth, covering the distinction between income (a flow) and wealth (a stock), the causes of inequality, the costs and benefits of inequality, and the redistributive policies governments use including progressive taxation, benefits and the provision of public services.
12 min answer →

How is unemployment measured, what are its causes, and what are its costs?

Unemployment: its measurement by the claimant count and the Labour Force Survey, the causes of unemployment (cyclical, structural, frictional and real-wage), and the economic and social costs of unemployment.
An Eduqas A520 answer to unemployment, covering the two measures (the claimant count and the International Labour Organisation Labour Force Survey), the main causes (cyclical, structural, frictional and real-wage unemployment), and the economic and social costs of unemployment, including the distinction between unemployment and underemployment.
12 min answer →