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9708 · 5.1

Government macroeconomic policy objectives

**Macro objectives** (5.1) frames **5.2–5.4 policy tools** and **10.1 A Level objectives**. In every essay, state the **output gap** and **conflicts** before recommending policy.

Need to know

What you need to know

  • Macroeconomic objectives are the primary goals of government economic policy.
  • The four key objectives are: growth, employment, inflation, and balance of payments.
  • These goals are pursued to improve national living standards and economic welfare.
  • Objectives can be complementary (e.g., growth creating jobs) or conflicting (e.g., low unemployment vs. low inflation).

Explanation

Government macroeconomic policy objectives

  1. Macroeconomic objectives are the primary goals of government economic policy.
  2. The four key objectives are: growth, employment, inflation, and balance of payments.
  3. These goals are pursued to improve national living standards and economic welfare.
  4. Objectives can be complementary (e.g., growth creating jobs) or conflicting (e.g., low unemployment vs. low inflation).
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