Principles and Applications of Macroeconomics: Challenges and Policies for UK Economy

Principles and
Applications of
Macroeconomics

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Concept, aim and the purpose of macroeconomic policies.........................................................1
System of UK economic.............................................................................................................2
Government use some macroeconomic policies for bettering the economic welfare.................3
How the Economy of UK can better achieve the success in the past 10 Years..........................4
Discussing the challenges that the government of UK deals with since last 10 years................5
Give some suggestions to solve the above challenges which are describes above: ...................8
CONCLUSION................................................................................................................................8
REFERENCES .............................................................................................................................10

INTRODUCTION
The branch of macroeconomics is mainly discussed about the government spending,
preparation of budgets, rate of interest, economy framework and the analyse the market
completely. Each and every economy face multiples changes of economics that consider in
account of the cyclic economy like Boom, depression and recession(Abubakar, 2020). It also
involves some another significant problems which need to be deliberated like inflation, deflation
which maximize the pricing scale. The overall sum of all goods and services can be elaborated in
gross domestic product which are move further during the accounting year. The models and
applications are useful in macroeconomics because it provide good help for computing the world
national income. In this case study it also included the society thoughts and welfare of economic.
The welfare of economic can be elaborated in the theory of economics which assists to share the
equal wealth among the individual in an economy and the uses of scarce fund in a very
productive and effectual manner. It also express the various of challenges that are faced by the
government of UK in last few years. Every issue that create an impact on the functioning and
working of the nation that need to addressed on time it would assist to determine the answer of
their issues and the problems which are related to the inflation and deflation which are to be
discussed below in this report.
MAIN BODY
Concept, aim and the purpose of macroeconomic policies
The concept of economics can be expressed by classified into two parts which includes
micro and macroeconomics. The concept of microeconomics include demand, supply, cost,
expenditures and examining the revenue and profit which are to created from the projects on the
ground of people and firm. This concept is mainly deals in the individual stage also in
macroeconomics concept they mainly deals in the overall sector which means carry projections
and tasks fully (Alekhina and Yoshino, 2019). Microeconomics assists to know the behaviour of
one individual also in macroeconomics it assists to know the nation behaviour on the basis of
higher scale. When they have good idea in relation to the changes of economic in prices and
index of price firms refer this in terms of macroeconomics. It is very significant for every
organization to create appropriate utilization of macroeconomics in every country. Which are to
be discussed as under:
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 Create better standard of living: when the nation gross domestic product is maximizes,
the residents of a nation anticipate the increase in their earning and income level also. It
will maximize the buying capacity which support to increase demand of qualitative
products for the individual people in the marketplace.
 Inflation: This can be described as the increase in the level of nation price. It can be
consider due to the movement of demand curve for the supplier of products and
services(Creel, 2020). The increase of reflective rate of growth and development of the
nation over a certain duration of time. Higher inflation show the limitations and would
create an impact on the development of market economy in a negative manner. It also
declines the buying power which are present for the individual and also reduce the worth
of money. So it clear the macroeconomics offers a source to achieve the p[point of
equilibrium in economy.
 Stage of equilibrium in balance of payment: It described about the dissimilarity among
the inflow and outflow of money from the nation(Çukur, 2020). It involves three
important accounts which includes: capital account, current account and financial
account. The planning of macroeconomic assist to achieve the balance of payment stage.
 Justifiable growth of economic: It includes some separate kinds of signals which assists
to measure the variations in economy which can be positive and adverse as well. If the
wealth is shared appropriately in each aspect, then it may be destruct the non-equalization
and incomplete distribution among the different divisions which are to be available in the
economy. It also support to better and improvise the results of firms which are already
setup in the nation it would also assist to develop and grow in another nations also.
System of UK economic
The system of economic can be described as a scheme which involves manufacturing,
finding of resources to the helpful fields and appropriate use of geographical location. It involves
some three kinds of economic system which are required to be implemented through individual
nations in context to their requirements and desires(Fang and et.al., 2018). The socialistic system
of economic is followed by every nation in context of their frequent approach in environment it
would assist to work in long run for the nation welfare. The nation level of production is decided
by the political party of a specific country which assist them to choose the prices which mainly
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