2.1

Question 1

the main objectives of government macroeconomics policy:

Answer 1

• Achieve economic growth and improve living standards and levels of economic welfare
• Create and maintain full employment or low unemployment
• Limit or control inflation, or to achieve some measure of price stability
• Attain a satisfactory balance of payments (avoid a deficit that could create an exchange rate crisis)

The possibility of conflict arising, at least in the short run, when attempting to achieve these objectives.