1. Economists are interested in 4 main questions… 1.Economic growth Has our economy grown in the last year, and is our capacity to product goods and services growing over time? 2.Full employment Is our economy efficient or do we have resources lying idle? 3.Stable prices Are we able to control prices so that we are competitive with other economies or are prices out of control? 4.Are we living within our means Are we buying more from other countries than we are selling to them?

2. These main questions lead to 4 main Macroeconomic Objectives Steady, sustainable economic growth - measured by GDP growth Low unemployment - measured by Claimant Count or Labour Force Survey Low, stable inflation - measured by CPI inflation – 2% target Balanced current account on the Balance of Payments - focus on net trade in goods & services

3. Some other objectives are also important to policy makers: Sustainable management of the environment and available resources Fair distribution of income among the population (Edexcel phrase this as ‘greater income equality’) Balanced government budget