admin- Man102 Notebook
- August 9, 2025
adminPublic Sector in the National Economy
Important Notes Features of the Public Sector Dir. of Welfare DAVID UC.
- admin
- Man102 Notebook
- August 9, 2025
Macro-economics
Macroeconomics Definition of MacroeconomicsMacroeconomics studies the performance, structure, behaviors, and decision-making of an economy as a whole. Components of Macroeconomics 1. UnemploymentUnemployment is a situation where individuals who are actively seeking work are unable to find a job. 2. Economic Growth RateWhen employment becomes low, the economic growth rate falls. It is the percentage increase in a country’s production of goods and services over a specific period, usually a year. 3. Gross Domestic ProductGross Domestic Product (GDP) refers to the total market value of goods and services produced in a country during a specific period, usually a year. 4. InflationInflation refers to the rate of increase in the price of goods and services in an economy over a given period. 5. OveremploymentOveremployment is excessive employment or use. It occurs when an employee’s desired work hours are exceeded by hours of labor demand at their current pay. 6. Full ProductionThis means that employed resources are providing maximum satisfaction of our economic wants.In a second meaning, it refers to a situation where all people in an economy who are ready, willing, and looking for work can find a job. Usually, a jobless rate of 5% is considered full employment.Full production, also known as full employment, is the optimal use of all available labor resources, providing maximum satisfaction of economic wants. 7. OverspendingOverspending occurs when an economy’s total spending exceeds its productive capacity, leading to imbalances such as inflation or unsustainable debt. 8. Over SpeedingThis happens when an economy grows too fast, leading to problems like debt and deficit. Macroeconomic Policy and Objectives Definition of Macroeconomic PolicyMacroeconomic policy refers to government actions aimed at regulating economic activities to sustain economic growth, create jobs, generate wealth, and raise the standard of living in the nation. What is Standard of Living Standard of LivingStandard of living is the quality of life available to the average citizen in a country or community. Types of Macroeconomic Policy 1. Monetary PolicyMonetary policy is the macroeconomic policy laid down by the Central Bank. It aims to manage the supply of money in circulation and interest rates. It is used to achieve macroeconomic objectives like inflation control, consumption, growth, and liquidity. Tools of Monetary Policy 2. Fiscal PolicyFiscal policy refers to the use of government spending and taxation to stimulate the economy. Types of Fiscal Policy Reasons for Contractionary Policy Important Notes Macroeconomic Objectives High and Sustainable Economic GrowthA long-term increase in a country’s real GDP without harming future growth potential. Price StabilityA situation where prices in the economy do not fluctuate, maintaining low and predictable inflation. Full Employment or Full Production Balance of Payment EquilibriumWhen the value of imports and exports are equal, avoiding large deficits or surpluses. Fair Income DistributionA situation where wealth and income are distributed more equally across society. Progressive TaxationA system where the tax rate remains the same for all income levels, meaning individuals pay the same percentage of their income regardless of earnings. Important Notes Please do well to comment below if there is…