An increase in the output of goods and services in an economy over time.

Gross Domestic Product - the total value of goods and services produced in a country within a given period.

By the percentage increase in real GDP.

GDP adjusted for inflation.

Higher living standards, lower unemployment, increased government revenue.

Inflation, environmental damage, and income inequality.

A persistent increase in the general price level of goods and services.

By the Consumer Price Index (CPI) or Retail Price Index (RPI).

Inflation that is caused by excessive aggregate demand.

Inflation that is caused by rising production costs.

Reduced purchasing power, uncertainty for businesses, and higher interest rates.

A sustained decrease in the general price level of goods and services.

It discourages spending and investment, leading to lower growth and higher unemployment.

The percentage of the labour force that is willing and able to work but cannot find a job.

1. Cyclical unemployment: Caused by a lack of demand during economic downturns.

2. Structural unemployment: Due to long-term changes in industries.

3. Frictional unemployment: Temporary unemployment while transitioning between jobs.

4. Seasonal unemployment: Occurs in industries with seasonal work (e.g., tourism, agriculture).

Lower incomes, reduced consumer spending, and increased government spending on benefits.

Training programs, lower taxes, and government job creation.

1. Economic growth: Aiming for sustainable GDP growth.

2. Low unemployment: Ensuring most people have jobs.

3. Stable inflation: Keeping inflation at a controlled level (e.g., 2%).

4. Balance of payments stability: Avoiding excessive trade deficits.

5. Income equality: Reducing the gap between rich and poor.

1. Fiscal policy: Government spending and taxation decisions.

2. Monetary policy: Central bank actions affecting interest rates and money supply.

3. Supply-side policy: Measures to improve productive capacity and efficiency.