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Uk economy comparison

Uk economy comparison. Labour force – by occupation (%). Government spending. Policy Instruments. Policy Goals. Policy Targets. Stable prices High employment Sustained growth Rising living standards Reduction in poverty Higher productivity. Monetary Policy Fiscal Policy

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Uk economy comparison

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  1. Uk economy comparison

  2. Labour force – by occupation (%)

  3. Government spending

  4. Policy Instruments Policy Goals Policy Targets Stable prices High employment Sustained growth Rising living standards Reduction in poverty Higher productivity Monetary Policy Fiscal Policy Supply side policy Exchange controls The Exchange Rate The Money Supply Aggregate demand Real GDP growth Budget deficit

  5. Savings (S) The Circular Flow Of Income Imports (M) Tax (T) Spending Households Products Factor Services Factor Incomes Investment (I) Firms Exports (X) Government Spending (G)

  6. Use of interest rates to influence consumer spending and Aggregate Demand (AD) Determined by Bank of England – currently 0.5% Increase interest rates to stop higher inflation & higher growth – boost saving Lower interest rates to stimulate spending and borrowing Monetary policy

  7. Involves: Taxation Government spending Borrowing when spending exceeds income Repaying debt when income exceeds expenditure Fiscal policy

  8. Direct and Indirect Direct – paid directly from individual / business Indirect – paid on goods and services e.g. VAT Progressive, Regressive and Proportional Progressive – Proportion paid increases as income increases Regressive – proportion paid decreases as income rises Proportional – proportion remains the same as income rises e.g. VAT taxation

  9. Income tax National insurance contributions Corporation tax Capital gains tax – on profits made on investments Inheritance tax Excise duties – fuel, alcohol, tobacco & gambling VAT Council tax Main uk taxes

  10. Any policy that improves economy’s productive potential and its ability to produce Policies for product markets Policies for labour markets Supply side policies

  11. Privatisation Deregulation of markets Tighten up competition policy Commitment to free international trade Measures to encourage small business start ups / entrepreneurship Capital investment and innovation Product market

  12. Trade union reforms Increased spending on education and training Income tax reforms and work incentives Labour market

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