Why does the government target a low rate of unemployment?
Will Frankfurt
I love learning and making complex things easy to understand.
Low unemployment is usually a good thing because: 1. It helps the government achieve one of their main macro-economic objectives. 2. It helps economic growth as consumers can spend more. Since consumer spending is a component of aggregate demand, the AD curve shifts to the right. 3. Higher employment means more tax money for the governments. As above, government spending is a component of AD so another reason the curve will shift to the right. That should be enough to get you started. Oh, and happy holidays π
Will also answered
Asked in Economics π
ASKED BY LAURA
ECONOMICS πCan you help by explaining to me the basic on poor housing and inequality of opportunity?
I'll be as brief as I can Laura! Firstly, I need to know what you mean by poor housing. Does it mean: 1. Poor quality housing 2. Housing with reside...
ASKED BY AREEB
ECONOMICS πWhat is an IPO and why is it a big deal when a company goes public?
An IPO stands for "Initial Public Offering". When a company IPO's, you (and most other people) can buy and sell small pieces of it (called shares). ...
ASKED BY NADINE
ECONOMICS πHow do you show revenue gain and revenue loss on both an inelastic and elastic demand graph ?
If I've understood your question correctly, you'd first need to understand how revenue could change: When demand is inelastic β a rise in price lead...
ASKED BY KING
ECONOMICS πHow would a rise in interest rates cause a fall in AD (include investment)?
Interest rates can be defined in the following two ways. Interest rates are the cost of borrowing for an economic agent (i.e the price of making an ...
ASKED BY KEVIN
ECONOMICS πHow does economic growth link with the circular flow of income?
When the economy grows, output increases which means thereβs and increase in aggregate demand which is made up of consumption, gov spending, net exp...
ASKED BY ABAS
ECONOMICS πWhat is the difference between a demerit and a merit good?
A merit good has two characteristics: People do not realise the true personal benefit. For example, people underestimate the benefit of education or...
ASKED BY KEVIN
ECONOMICS πHow will the excess use of machinery effect employment?
It's an interesting question. It can either increase or decrease employment. It depends whether you are talking about the short run or the long run....
ASKED BY EDIS
ECONOMICS πWhich type of firm faces the most competition and why? Is this good for economic efficiency?
Technically, firms in 'perfect competition' have the most amount of competition because the goods are identical and there are zero barriers to entry...
ASKED BY LAURA
ECONOMICS πCan you please explain the basics on poor housing and inequality of opportunity for economics????
I'll be as brief as I can Laura! Firstly, I need to know what you mean by poor housing. Does it mean: 1. Poor quality housing 2. Housing with reside...
ASKED BY NADINE
ECONOMICS πWhat is a subsidy and are there any examples of a subsidy?
Subsidy: Definition - Money that is given by the government (or other public bodies) to support an industry or organisation. It is usually done to e...
Find me a tutor
We take your privacy seriously. View our policy.