Macroeconomic Indicators – OCR Spec
Macroeconomic Indicators – OCR Spec
Level: AS Levels, A Level, GCSE – Exam Boards: Edexcel, AQA, OCR, WJEC, IB, Eduqas – Economics Revision Notes
Trends in the Macroeconomic Indicators over the last 20 years
Economic Growth
The UK has generally experienced economic growth throughout the last 20 years, however output fell during the Financial Crisis in 2008.
In 2008 and 2009, Economic Growth became negative, however started becoming positive again in 2010
Inflation
From 1997-2005, inflation was below the 2% inflation rate target set by the Bank of England.
In 2008 and 2011, the UK experiences high inflation rates of 5.2%, however this followed with a short period of deflation in 2015 as prices fell by 0.1%.
Employment
In 2014, the employment rate of 16-24 year olds peaked at 73.2%. However, during the Financial Crisis (2009-2011), the employment rate fell to 70.1%
Balance of Payments
There is a trade deficit in goods, however a trade surplus in services. Since the UK imports more goods / services then it exports, there has been a trade deficit existing throughout the past 20 years.
Evaluate the current performance of the UK economy compared with other developed / emerged / developing economies
- In 2014, the UK grew by 2.6% – which was much faster than the US, Canada, Japan, and parts of Europe (Spain, Germany, France, Italy)
- In 2012, the UK’s economy was the eighth largest, in terms of Nominal GDP
- in 2013, emerging economies such as China, India and Brazil were estimated to contribute to half of the global growth
- It is predicted that Mexico and Indonesia will overtake the UK by 2050
- The UK had a GDP of $2.47 trillion in 2012, which was approximately a quarter of China’s ($8.23 trillion). However, Mexico had a GDP of $1.18 trillion and Indonesia had a GDP of $0.88 trillion
- It is estimated that China will have the largest economy worldwide, with a GDP of $52.62 trillion. In comparison to the UK, the UK is estimated to have a GDP of $5.69 trillion
Quick Fire Quiz – Knowledge Check
1. Explain how Economic Growth has changed over the last 20 years (4 marks)
2. Explain how Inflation has changed over the last 20 years (4 marks)
3. Explain how Employment has changed over the last 20 years (4 marks)
4. Explain how the Balance of Payments have changed over the last 20 years (4 marks)
5. Evaluate the current performance of the UK’s economy compared to other developed / emerging / developing economies (8 marks)
Next Revision Topics
- Macroeconomic Objectives
- Macroeconomic Policies in a Global Context
- Conflicts between Macroeconomic Policies
A Level Economics Past Papers
