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Essay

To what extent does a policy of full employment conflicts with other government objectives?

Essay specific features

 

Issue:

Business

 

Written by:

Ruth L

 

Date added:

March 23, 2013

 

Level:

University

 

Grade:

A

 

No of pages / words:

2 / 376

 

Was viewed:

915 times

 

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Essay content:

As wages increase, more people are willing to work but production costs rise. If strong economic growth persists, wages pressures continue to build, leading to increasing inflation (cost-push inflation). On the other hand, unemployment provides potential for the economy to expand and can act as a downward pressure on inflation...
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On the other hand, unemployment provides potential for the economy to expand and can act as a downward pressure on inflation. Furthermore expansionary fiscal policies will cause higher consumer spending and therefore a rise in imports; this causes a current account deficit. This is particularly a problem in the UK, where consumers have a high Marginal propensity to consume imports...
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