Scarcity and Society 2

Question 1

Society tends to use all of its resources

Give 2 problems that may arise from this?

Answer 1

• ^{_{<span>High Unemployment </span>}}
• ^{_{<span>A recession </span>}}

Question 2

What can result if the Government tries to increase the growth of its economy

Answer 2

• Inflation
• Rising imports

Question 4

Macroeconomic problems are related

————Supply and ————-Demand

Answer 4

• Aggregate Supply and Demand

Question 5

If ———–Demand is greater relative to the ———-Supply,

what will occur?

Answer 5

• Aggregate
• Inflation and Trade deficits are likely to occur

Question 6

What do you think is the meaning of inflation?

Answer 6

The general rise in the level of pricing throughout the economy

Question 7

If Aggregate demand increases, what do companies tend to do?

Answer 7

Increase their pricing of products

Question 8

when companies/firms increase their prices due to aggregate demand, do they make a greater profit and if so why

Answer 8

Yes-

because there is a greater aggregate demand meaning more people will like to buy it.

Question 9

When Companies/firms increase their pricing due to aggregate demand, it is classified as Inflation, if so/not why?

Answer 9

Not inflation,

Aggregate demand is high

Question 10

If companies/firms generally increase pricing throughout the economy,

what is it called?

Hint:It starts when the letter I

Answer 10

Inflation!!!!!!!!!!!!!!!!!!!!

Question 11

How do we measure the rate of inflation?

Answer 11

By comparing price levels in different periods of time

Question 12

Meaning of the rate of inflation?

Answer 12

Percentage increase of pricing every 12 months/1 year

Question 13

What do you think Balance of trade deficit means?

Answer 13

The excess of imports over the exports of an economy