Sunday, 15 February 2009

ECO summary:balance of payment

what are included:
-trade in goods
-trade in services
-investment income from UK overseas assets
-transfer of money between people and government
trade goods -transfer of money =comprises the current account

actual GDP>potential GDP:positive output gap
actual GDP
AD:C+G+I+(X-M)

EXpenditure reduction:
-higher interest rate
-higher tax

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