Summary Edexcel A/l Economics - Conflicts between macroeconomic objectives

CONFLICTS BETWEEN MACROECON
OBJECTIVES

Equilibrium on
Economic Reducing Controlling Su
the balance of
Growth Unemployment In ation De
payment

• Business Expansion • Cost Push In ation • Export Led Growth • Subs
green
Economic therefore more job
• Higher incomes - more
• Inves
opportunities • Demand Pull In ation deve
Growth demand for imports
( AD ↑ HIGHER PROFITS ) ( AD ↑ Consumption ↑ ) • Importing raw materials • Deple
( Firms Spending ↑ ) • More

• Increased AD for goods • Mor
• More people actively
due to high disposable • Higher disposable rese
Reducing contributing in the
economy
income income
Unemployment • Workers can bargain
( Therefore more imports ) • Mor
pollu
( More Productivity )
higher wages

• Increase taxes and • Higher Unemployment • Domestic goods are cheaper
interest rates
Controlling ( Businesses do not have much
( Consumers will buy more
domestic goods )
In ation ( Therefore more savings
lesser spending )
pro ts to expand businesses )
• Exports will become cheaper




Equilibrium on • Exports and imports are • Export sector might be
• Exports might increase

the balance of balance growing ( More jobs ) • Demand pull In ation

payment
• Increasing taxes on oil
and non renewable
Sustainable resources
Development
• Rules and regulations