Edexcel (IAL) AS Economics Unit 2

Unit 2 Macroeconomic Performance and Policy

 

2.3.1 Measures of economic performance

  • Economic
  • Inflation
  • Employment and unemployment
  • Balance of Payments
  • Measures of development
  • Other measures of development

2.3.2 The circular flow of income

  • National income
  • Injections and withdrawals

2.3.3 Aggregate demand (AD)

  • The characteristics of AD
  • Consumption (C
  • Investment (I)
  • Government expenditure (G)
  • Exports – Imports (X-M)

2.3.4 Aggregate supply (AS)

  • The characteristics of AS
  • Short-run and long-run AS

2.3.5 The interaction of AD and AS to determine equilibrium

  • Equilibrium level of real output
  • The multiplier

2.3.6 Economic growth

  • Causes of growth
  • Constraints on growth
  • Benefits of growth
  • Costs of growth
  • Output gaps

2.3.7 Macroeconomic objectives and policies

  • Macroeconomic objectives
  • Conflicts between objectives
  • Macroeconomic policy instruments

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