Problem

Macroeconomics is an aggregate of what happens at…

03:23

Problem 23 Easy Difficulty

A balanced federal budget and a balance of trade are secondary goals of macroeconomics, while growth
in the standard of living (for example) is a primary goal. Why do you think that is so?

Answer

A balance budget is a budget in which expenditures are equal to the revenues i.e. there is neither a budget surplus nor a budget deficit.
Balance of trade is a difference between the imports and exports of a country.
Standard of living refers to the comfort, level of wealth, necessities and goods that are accessible to a class of a society.

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Video Transcript

Hey, everyone, today we're going through Problem 23 from chapter one of the textbook, which recently gives us a scenario where, for example, standard of living is a primary goal of macroeconomics wears, you know, a balance of trade and a balanced federal budget are just secondary goals. And the question asked, why is this the case? So that stops in solving this. Aren't you kind of identify? Um, no differences between, um Collins? Well, it's Fred. I just as well as balance of trade versus no standard of living in the two. What? No witness Differences. Rich difference relates most to macroeconomics, rather not which difference, but which one more thing you others differences which characteristic art in my spelling. Yeah. Which characteristic of standard of living. You know, it's a having relate most of macro economics, right? So in dealing with this first up, um, we know that kind of a balanced federal budget and a balance of trade are kind of means to end, not ends themselves, whereas, um, something right that ground copy and paste this so those are means to an end, not ends. In contrast, what we know is that standard of living no effects. Um, what people are doing and what they actually care about. And it's an actual and itself. Now, what I mean by this is that the objective is to make people better off by raising standards of living. So let me write this under part two. So just to elaborate more, I'm standard of living. The best characteristic about it is God, um, it makes people better off. In contrast, no balance. Federal budget, Andi, Balance of trade. It will actually make you better off. Excuse me. Where's abound? Federal budget and a balance of trade may help us to achieve that objective, but may not actually results in that objective. Who only helped to make people better? Oh, us. We know that gender living. It's a primary goal. Where's balanced federal budget and balance a traitor only secondary goals. Because macroeconomics us, remember, you know, is about affecting the people. So people No, because the people represented the economy. So people care most about, um, surrendered if living, and thus it relates to not grow cotton water. All right, so there you have it. If you guys enjoy this video explanation, please of the like, right next to it. And have a nice day

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