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SingaporeEconomics

The Macroeconomy and Its Aims

4 dot points across 4 inquiry questions. Click any dot point for a focused answer with worked past exam questions where available.

What is total spending in an economy made of, and how does money flow around it?

Explain aggregate demand and its components, and the circular flow of income between households and firms
A clear O-Level answer on aggregate demand and the circular flow. The four components of total spending, the flow of income between households and firms, the role of injections and withdrawals, and the main aims of government.
8 min answer →

What is economic growth, how is it measured, and does it always make people better off?

Define economic growth and GDP, explain its causes, and assess its link to the standard of living
A clear O-Level answer on economic growth and living standards. What GDP measures, the causes of growth, why GDP per head is used to judge living standards, and the limitations of GDP as a measure of wellbeing.
8 min answer →

What is inflation, what causes it, and why does it matter?

Define inflation, explain its demand-pull and cost-push causes, and assess its consequences
A clear O-Level answer on inflation. How inflation is defined and measured, the difference between demand-pull and cost-push causes, the consequences for households, firms and the economy, and why low stable inflation is a government aim.
8 min answer →

Who counts as unemployed, what causes it, and why does it matter?

Define unemployment, explain its main types and causes, and assess its consequences
A clear O-Level answer on unemployment. How it is defined and measured, the main types including cyclical, structural and frictional, the consequences for individuals and the economy, and why low unemployment is a government aim.
8 min answer →