Principles and Applications of Macroeconomics: Government Policies to Increase Economic Welfare in the UK

PRINCIPLES AND
APPLICATIONS OF
MACROECONOMICS

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK...............................................................................................................................................3
Explanation for how government use macroeconomic policy to increase economic welfare....3
Explanation the changes come in UK government over the last 10 years and changes remain
in future.......................................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Economics is the study of process by which the available resources are allocated to
people to satisfy their unlimited wants. Economics includes business economics which may be
defined as the use of economic analysis to make business decision. Economics has been
classified into two parts micro economics and macro economics. Macro economics focus of the
whole economy rather than its individual parts. It determines the overall levels of output,
employment, total saving, total consumption, exports, imports and foreign investments. To
stabilize the economy government can use macroeconomic, monetary and fiscal policy. The
government uses many models to develop economic strategies and policies. A important factor
of macroeconomics is the evaluation of inflation and deflation. Inflation means increases the
price of goods and service and deflation means down fall the prices of goods and services. With
the help of price indexes economists determine inflation and deflation. The another factor
indicate the unemployment rate. It evaluates how many people without a job. The unemployment
rate in the country is very high it means the economic output is less. Government founds new
policies to balance in the economy such as monetary and fiscal policy. Monetary policies are
implemented by the Reserve Bank of India. The objective of monetary policy is to stabilise GDP
and decreases the rate of unemployment. Fiscal policies is the important tool to control economic
stability (Abuzjarova, M.I., 2018). It is regulated by the government and can be altered by
political intentions. Macroeconomics is a discipline of economics which deals household, firms
government and external factor. Macroeconomics is essential to understand the economic
situation of a country. In this report contains the details of macro economics and the discussion
the policies which are adopted by UK government to increase the welfare. Further in this report
contains the measures which make the UK government successful over the last ten years and
challenges will make in future. (Carroll and et.al, 2020).
TASK
Explanation for how government use macroeconomic policy to increase economic welfare
Macroeconomics is the study of a national or regional economy. It evaluates how the
economy, the market and other system that operates on a large scale. It focuses the performance,
structure and behaviour of the economy. The objective of macroeconomic policy to establish
economic environment (Ulubeyli, and Kazanci, 2018). It gives special consideration on the