Beat the Teacher
Highlight any errors you find in the following article
Macroeconomic objectives
The UK government has 4 main macroeconomic objectives. They are
low unemployment, high inflation (low inflation), surplus on the current
account of the balance of payments and sustainable economic growth.
Low unemployment is believe to be important. The number of people out
of work but seeking a job is calculated by the number of people claiming
incapacity benefit (job seekers allowance). The number of people out of
work but seeking a job is calculated by the number of people incapacity
benefit.
In the UK the target for inflation is 5% (2%). The Monetary Policy
Committee set this allowing a + or – 1% window. Inflation measures the
general rise in average prices. The Consumer Price Index (CPI)
measures a basket of approximately 650 goods and the annual change
in them.
The current account of the balance of payments measures exports
minus imports. If the amount of exports is greater than the amount of
imports then there is said to be a deficit (surplus). The UK has had a
deficit in the current account for quite some time. A deficit is not a great
problem as it is good to have a large amount of imports into a country if
the imports improve living standards.
Sustainable economic growth is the fourth objective of the government.
Economic Growth is measured by the annual percentage change in real
GDP. Real means taking into account interest rates (inflation). Economic
Growth is the increasing in the productive potential of the economy.