ECONOMICS LEVEL 3
Unit 2: Economic Management
Macroeconomic activity
Economic knowledge
- Aggregate demand and aggregate supply.
Economic reasoning
- Illustration of changes in macroeconomic equilibrium using the AD/AS model
The objectives of economic policy
Economic knowledge
Roles of government in a modified market economy:
- stabilising the business cycle redistributing income through taxation and spending and the provision of goods and services
Management Policies
Economic knowledge
Fiscal/Budgetary policy:
- definition of fiscal policy as a tool of demand management
- distinction between fiscal stance (expansionary, contractionary and neutral) and fiscal outcome (deficit, surplus balance)
Economic reasoning
- Impact of different fiscal policy stances on the level of economic activity