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The Government, with the help of the National Treasury Management Agency, has been successful in reducing Ireland's national debt, while continuing to invest in infrastructure - Leaving Cert Economics - Question 6 - 2008
Question 6
The Government, with the help of the National Treasury Management Agency, has been successful in reducing Ireland's national debt, while continuing to invest in infr... show full transcript
Worked Solution & Example Answer:The Government, with the help of the National Treasury Management Agency, has been successful in reducing Ireland's national debt, while continuing to invest in infrastructure - Leaving Cert Economics - Question 6 - 2008
Step 1
Explain each of the underlined terms.
Answer
National Debt
National debt refers to the total amount of government borrowing. This encompasses all the money the government owes to creditors, which may include both domestic and foreign loans. The national debt is an important economic indicator as it reflects the financial obligations of the government and its ability to manage its finances effectively.
Infrastructure
Infrastructure consists of the essential goods and services necessary for the smooth operation of an economy. This includes physical facilities and services such as roads, ports, telecommunications, power, water supply, and waste disposal. Proper infrastructure is critical for economic development as it affects the efficiency and effectiveness of operations within an economy.
Step 2
State three other economic aims of the Government.
Answer
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Full Employment: Ensuring that all citizens have access to job opportunities, maintaining competitiveness, and reducing unemployment levels.
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Control Price Inflation: Managing inflation rates to stabilize the economy and maintain consumer purchasing power through effective fiscal policies.
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Achieve Moderate Economic Growth: Striving for a balanced economic growth rate, ensuring sustainable development while managing resources effectively.
Step 3
Write brief notes on each of these aims.
Answer
Full Employment
The government aims to maintain competitiveness and ensure all citizens have access to employment opportunities. This approach not only fosters economic stability but also enhances the quality of life for individuals.
Control Price Inflation
To contend with the pressures on pricing within the economy, the government implements measures that stabilize inflation rates. These include monetary policy adjustments aimed at ensuring sustainable price levels.
Achieve Moderate Economic Growth
Moderate economic growth is targeted to manage economic activity effectively. The government aims to balance economic expansion with the need to prevent overheating the economy, often managing this through taxation strategies and fiscal policies.