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Which are two aims that a Government normally pursues when managing the performance of the whole economy?1 pointA to encourage an increase in production and to prevent high inflationB to ensure no one is unemployed and to reduce exportsC to give everyone equal incomes and to increase government revenuesD to protect the environment and to reduce interest ratesClear selection

Question

Which are two aims that a Government normally pursues when managing the performance of the whole economy?1 pointA to encourage an increase in production and to prevent high inflationB to ensure no one is unemployed and to reduce exportsC to give everyone equal incomes and to increase government revenuesD to protect the environment and to reduce interest ratesClear selection

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Solution

The two aims that a government normally pursues when managing the performance of the whole economy are:

A) To encourage an increase in production and to prevent high inflation.

This is because increasing production can lead to economic growth and job creation, which are both positive for the economy. Preventing high inflation is also important as it maintains the purchasing power of the currency, ensuring that consumers' income does not lose value.

The other options are not typically primary aims of economic management. While governments do aim to reduce unemployment, they do not typically aim to reduce exports - in fact, many governments aim to increase exports as it can lead to economic growth. Equal income is not typically a primary aim of governments as it can disincentivize work and innovation. Increasing government revenues is a goal, but it is usually secondary to other economic goals. Protecting the environment and reducing interest rates can be goals of government policy, but they are not typically the primary aims when managing the performance of the whole economy.

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