Chapter 1: Problem 22

What are some widely held economic goals of society?

Short Answer

Expert verified

Some widely held economic goals of society include economic growth, full employment, price stability, equitable income distribution, environmental sustainability, and economic stability. These goals aim to ensure prosperity, equality, and stability within an economy, promoting the overall well-being of its citizens.

Step by step solution

Identify economic goals of society

To address this exercise, let's list some common economic goals that societies or economies strive to achieve. We will briefly describe each one.

1. Economic growth

Economic growth refers to the increase in the production of goods and services over a specific period of time. This can be measured using the growth rate of an economy's Gross Domestic Product (GDP). It is a widely accepted goal of society as it generally leads to increased income, employment opportunities, and improved living standards.

2. Full employment

Full employment is another important goal of society, and it is generally achieved when all individuals who are willing and able to work can find jobs. At full employment, the unemployment rate is at a natural and manageable level, which minimizes negative social and economic consequences resulting from high unemployment.

3. Price stability

Price stability means maintaining a low and stable inflation rate, which is the rate at which the general level of prices for goods and services is rising. High inflation can lead to uncertainty and reduced purchasing power, while deflation can result in decreased economic activity. Therefore, managing inflation through monetary and fiscal policies helps ensure price stability, an important goal for any economy.

4. Equitable income distribution

Society also aims to achieve a fair distribution of income among its members. Inequality can lead to social tensions and limit economic growth as resources are concentrated in the hands of a few. Various policies, such as progressive taxation and social welfare programs, can be implemented to reduce income disparity and promote equal opportunities for all citizens.

5. Environmental sustainability

Environmental sustainability is another vital economic goal, as it entails the efficient use of resources and the protection of the environment for future generations. This often involves promoting the use of renewable energy sources, regulating pollution, and encouraging sustainable practices in agriculture and industry.

6. Economic stability

Achieving economic stability is essential for societies, as it helps avert financial crises and recessions that can result in high unemployment, reduced income, and decreased living standards. Policies aimed at maintaining economic stability include sound fiscal and monetary management, maintaining the stability of financial markets, and promoting international trade. These are just a few examples of the widely held economic objectives that are important to societies. The specific goals and priorities may vary across countries and over time, but these goals broadly encompass the pursuit of prosperity, equality, and stability in an economy.

Unlock Step-by-Step Solutions & Ace Your Exams!

Full Textbook Solutions
Get detailed explanations and key concepts
Unlimited Al creation
Al flashcards, explanations, exams and more...
Ads-free access
To over 500 millions flashcards
Money-back guarantee
We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!