On the macroeconomics spectrum, policies are made to reach economic growth, stability and full employment. All economic analysis that refers to aggregates is macro. 6. The final macroeconomic objective we will discuss is that of equity in the distribution of income. around 3%) Current account – balance of payments. Equitable distribution of income and wealth – a fair share of the national ‘cake’, more equitable than would be in the case of an entirely free market. As mentioned before one of the possible consequences of economic growth in a free market economy is inequality in the distribution of income. Equality: … Balance of … Objectives guide and govern the actions and behaviour of businessmen. Economic growth – positive and sustainable growth (The UK, long-run trend rate is around 2.5%) Low inflation (UK target 2% +/-1) – Low unemployment / Full employment (e.g. There are other objectives which are increasingly becoming important for governments: 5. avoid unsustainable current account deficit) 2.3 Macroeconomic objectives: Low unemployment . ; Disinflation is fall in the rate of inflation. In this tutorial, our aim is to summarise the five objectives of the South African government’s macroeconomic policy. The five major economic goals are full employment, economic growth, efficiency, stability and equity, and they are divided into both macroeconomic and microeconomic goals. Objectives represent the purpose for which an organisation has been started. Price stability 3. Macroeconomics is concerned with issues, objectives and policies that affect the whole economy. Full employment 2. ; Deflation – decrease in the price level of an economy over a period of time. This study has three objectives with regard to the South African economy in the post-apartheid era: (i) Investigating the factors that influence economic growth by a simultaneous macro-econometric model; We will give a definition of each concept and indicate how it is measured. Satisfactory position (i.e. We will then clarify the relative importance of each objective. macroeconomic policies: government expenditure, income tax rate, nominal interest rate, inflation target, foreign aid and domestic credit. 3. to encourage economic growth 4. to encourage trade and secure a favourable balance of payments. Economic growth can indeed transform people’s lives and enable them to live longer because of better nutrition, housing and health care. Redistribution of Income 5. Full Employment 2. The main macro-economic objectives. ! Macroeconomics: Macroeconomics is the study of the economy as a whole such … Another macroeconomic objective is low and stable rate of inflation.. Definitions: Inflation is persistent increase in the price level of an economy over a period of time. 2.3 Macroeconomic Objectives Ruru Hoong Oct’ 2014 • Governments have to pay monthly benefits to the unemployed; fiscal resources could have been used in the provision of public goods or merit goods (opportunity cost) • Puts pressure on government’s fiscal conditions (increased budget deficits) 5. ADVERTISEMENTS: Five most important objectives of business may be classified are as follows: 1. economic objectives, 2. social objectives, 3. human objectives, 4. national objectives, 5. global objectives. Economic Growth 4. Macroeconomics provides government policymakers with a set of tools that can be employed to help achieve certain macroeconomic objectives deemed desirable for a nation. The four major objectives are: 1. How does the government achieve the main 5 macroeconomics objectives? Price Stability 3. Equity vs. Some of the main government aims for economy are as follows: 1. 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