Price stability means that inflation should be kept as low as possible. The costs of inflation are discussed in the section of inflation. When prices remain largely stable, and there is not rapid inflation or deflation. Price stability is not necessarily the same as zero inflation, but instead a steady level of low-moderate inflation is often regarded as ideal. Inflation is usually defined as a sustained rise in the general level of prices. Stable prices are crucial for business confidence, facilitations contracts and enabling the exchange rate system to function smoothly, in contrast, persistently rising prices cause problems for most sectors of economy. Price stability has become the primary objective of most governments that wish to secure long-term growth and full employment. Economists no longer believe that tolerating higher rates of inflation can lead to higher employment or output over the longer term. 2. To maintain a high level of employment and a low level of unemployment The pursuit of full employment (or the combating of unemployment) should be an obvious objective of economic policy; full employment is a condition of the national economy, where all or nearly all persons willing and able to work at the prevailing wages and working conditions are able to do so. Full employment does not mean that everybody of working age is employed, as in and dynamic economy some unemployment is unavoidable. Foe example, there will always be individual moving in and out of employments, as they charge from one job to another, and there will always be seasonal, technological and overseas factors that cause fluctuations in the jobs available in different sectors. Problem arise, however, when there are large number of unemployed for long period of time; as a large pool of unemployed labour represents wasted resources. It also has many costs, not just in terms of loss of output but also in terms of human suffering and loss of dignity. All governments record the number of workers without a job, although the precise way this is measured changes from time to time. 3. To encourage economic growth The pursuit of economic growth requires no further explanation. An expansion of national production and income is a prerequisite for job creation, improved living standards and economic development. An along-term objective of all governments is to achieve steady increases in productive capacity. Governments measure economic growth by the annual the rate of output, and the commonly used measure of economic output is GDP- Gross (total) Domestic (home) product
Price stability means that inflation should be kept as low as possible. The costs of inflation are discussed in the section of inflation. When prices remain largely stable, and there is not rapid inflation or deflation. Price stability is not necessarily the same as zero inflation, but instead a steady level of low-moderate inflation is often regarded as ideal. Inflation is usually defined as a sustained rise in the general level of prices. Stable prices are crucial for business confidence, facilitations contracts and enabling the exchange rate system to function smoothly, in contrast, persistently rising prices cause problems for most sectors of economy. Price stability has become the primary objective of most governments that wish to secure long-term growth and full employment. Economists no longer believe that tolerating higher rates of inflation can lead to higher employment or output over the longer term. 2. To maintain a high level of employment and a low level of unemployment The pursuit of full employment (or the combating of unemployment) should be an obvious objective of economic policy; full employment is a condition of the national economy, where all or nearly all persons willing and able to work at the prevailing wages and working conditions are able to do so. Full employment does not mean that everybody of working age is employed, as in and dynamic economy some unemployment is unavoidable. Foe example, there will always be individual moving in and out of employments, as they charge from one job to another, and there will always be seasonal, technological and overseas factors that cause fluctuations in the jobs available in different sectors. Problem arise, however, when there are large number of unemployed for long period of time; as a large pool of unemployed labour represents wasted resources. It also has many costs, not just in terms of loss of output but also in terms of human suffering and loss of dignity. All governments record the number of workers without a job, although the precise way this is measured changes from time to time. 3. To encourage economic growth The pursuit of economic growth requires no further explanation. An expansion of national production and income is a prerequisite for job creation, improved living standards and economic development. An along-term objective of all governments is to achieve steady increases in productive capacity. Governments measure economic growth by the annual the rate of output, and the commonly used measure of economic output is GDP- Gross (total) Domestic (home) product
Principles%20of%20Construction%20Economics.docx