macro-economic issues in short note
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In a certain way macroeconomics does helps in achieving the goal of economicgrowth, higher level of GDP and higher level of employment. It also analyses the forces which determine economic growth of a country. ... It helps to solve economic problems like poverty, unemployment, inflation, deflation etc.
Importance of Macroeconomics
1. It helps in understand the functioning of a complex modern economic system. Macroeconomics gives us a clue on how the economy functions on a whole and how the level of national income and employment is determined on the basis of aggregate demand and aggregate supply.
2. In a certain way macroeconomics does helps in achieving the goal of economic growth , higher level of GDP and higher level of employment.
3. It also analyses the forces which determine economic growth of a country. Understanding the macroeconomic problems gives a cue on how to reach the highest state of economic growth and sustain it.
4. Bringing stability in price level and analysis of the fluctuations in business activities is another set of macroeconomic problems that are taken care by better understanding of macroeconomics.
5. Macroeconomics helps in suggesting policy measures to control inflation and deflation.
6. It explains factors affecting balance of payment. It also identifies causes of deficit in balance of payment and suggests measures for the same.
7. It helps to solve economic problems like poverty, unemployment, inflation, deflation etc. The solution for such macroeconomic problem is possible at macro level only.
8. Better understanding of the macroeconomics of the country helps to formulate correct economic policies and also coordinate with international economic policies.
Macroeconomics Problems: What are they?
Now that we have understood the meaning and importance of macroeconomics, let’s try to grasp some ideas about some common macroeconomics problems. In the earlier paragraphs of this article we have heard some terms that are related to macroeconomics. Some of them were inflation, unemployment, balance of payment etc. So now let’s get to know them better. Have you ever tried to think of when these macroeconomics problems arise? To get your doubts clear let me share the answer with you. Macroeconomics problems arise when the economy does not adequately achieve the goals of full employment, stability, and economic growth. As a result of which there is a cascading effect which follows. Unemployment results when full employment is not achieved. Inflation creeps in when the economy falls short of the goal of stability. The phase of stagnant growth arises when the economy is not adequately attaining the goal of economic growth. All these problems are either caused by too little or too much demand for gross production. For instance, unemployment results from too little demand and inflation emerges with too much demand.
Importance of Macroeconomics
1. It helps in understand the functioning of a complex modern economic system. Macroeconomics gives us a clue on how the economy functions on a whole and how the level of national income and employment is determined on the basis of aggregate demand and aggregate supply.
2. In a certain way macroeconomics does helps in achieving the goal of economic growth , higher level of GDP and higher level of employment.
3. It also analyses the forces which determine economic growth of a country. Understanding the macroeconomic problems gives a cue on how to reach the highest state of economic growth and sustain it.
4. Bringing stability in price level and analysis of the fluctuations in business activities is another set of macroeconomic problems that are taken care by better understanding of macroeconomics.
5. Macroeconomics helps in suggesting policy measures to control inflation and deflation.
6. It explains factors affecting balance of payment. It also identifies causes of deficit in balance of payment and suggests measures for the same.
7. It helps to solve economic problems like poverty, unemployment, inflation, deflation etc. The solution for such macroeconomic problem is possible at macro level only.
8. Better understanding of the macroeconomics of the country helps to formulate correct economic policies and also coordinate with international economic policies.
Macroeconomics Problems: What are they?
Now that we have understood the meaning and importance of macroeconomics, let’s try to grasp some ideas about some common macroeconomics problems. In the earlier paragraphs of this article we have heard some terms that are related to macroeconomics. Some of them were inflation, unemployment, balance of payment etc. So now let’s get to know them better. Have you ever tried to think of when these macroeconomics problems arise? To get your doubts clear let me share the answer with you. Macroeconomics problems arise when the economy does not adequately achieve the goals of full employment, stability, and economic growth. As a result of which there is a cascading effect which follows. Unemployment results when full employment is not achieved. Inflation creeps in when the economy falls short of the goal of stability. The phase of stagnant growth arises when the economy is not adequately attaining the goal of economic growth. All these problems are either caused by too little or too much demand for gross production. For instance, unemployment results from too little demand and inflation emerges with too much demand.
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