LS1- Key Players in the Economy

Question 1

Employment

Answer 1

Most people of working age rely on jobs as a source of income and many derive a sense of purpose from their occupations. Therefore, employment is important. Furthermore, high unemployment has the potential to lead to social unrest.

Question 2

Inflation

Answer 2

• A rise in the general price level for goods and services
• High inflation erodes living standards
• Governments and central banks generally seek to maintain low inflation.

Question 3

Capital good

Answer 3

A good used to produce other goods and services e.g. a machine