Full employment, keeping inflation under control, and economic growth are among the major macroeconomic goals of...

  

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Full employment, keeping inflation under control, and economic growth are among the major macroeconomic goals of all societies. Why is economic growth a major macroeco- nomic goal? What is potential output and how is it related to the target rate of unemployment and the target level of capacity utilization? Which is greater: potential or actual output during a recession? During an economic boom? What are some of the problems with the interpretation of unemployment statistics that can cause unemployment statistics to underes- timate and to overestimate the true rate of unemployment? How do Classical and Keynesian economists differ in this regard? Full employment, keeping inflation under control, and economic growth are among the major macroeconomic goals of all societies. Why is economic growth a major macroeco- nomic goal? What is potential output and how is it related to the target rate of unemployment and the target level of capacity utilization? Which is greater: potential or actual output during a recession? During an economic boom? What are some of the problems with the interpretation of unemployment statistics that can cause unemployment statistics to underes- timate and to overestimate the true rate of unemployment? How do Classical and Keynesian economists differ in this regard?

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Economic growth is a major macroeconomic goal because it leads to higher standards of living increas... View the full answer