Tag: Economic Management – Policies and Goals

Terms used in Economic Policies and Goals

Terms used in Economic Policies and Goals The following are the definitions of terms used in regards to economic policies and goals. National budget: This is the total amount of money forecasted to be spent by the government to cover all of its expenses over a particular period (usually a year). National income: This is…...

Circular Flow of Income

Circular Flow of Income Circular flow of income is the name of the concept which shows how money moves in an economy. This is demonstrated in the diagram below. Figure 5.1 Figure 5.1 shows the circular flow of income. From figure 5.1 above, we can see that households have the option of doing two things with…...

Nominal and Real Output

Nominal and Real Output Nominal and real output, refer to what prices are used in valuing different outputs produced in an economy over a specified time period. Nominal output values goods and services at the price at which they were sold. Real output values goods and services of different years at the same prices (this…...

Inflation

Inflation There are three major causes of inflation: – When demand is growing faster than supply which leads to increase in prices (demand- pull inflation). – When companies operational costs increase due to increases in either the inputs, wages etc, which results in an increase in the price of their products in order to maintain…...

Recession

Recession A recession can be defined as a period of general economic decline. This is usually observable through a drop in GDP for two or more quarters. There are many factors which contribute to an economy going into a recession. This includes, a low level of consumer spending. The reasons for the low level of…...

Trade Unions

Trade Unions Trade Unions are organizations created to represent/protect the rights of their members in negotiations with their respective employers/managers. Trade unions major roles include; representing their members in wage negotiations, questioning the grounds on which members are suspended, fired or made redundant, and representing members who have been harassed or victimized.   Read more...