Pg 43 # 1,2,3,4

1. Explain why each of the following pairs represents either

complementary or conflicting goals.
a) Full employment and price stability
Conflicting: full employment attempts to promote full
employment and although full employment of the workforce
can be beneficial, it also promotes inflation with conflicts with
the goal of price stability; which tries to balance inflation and
deflation.
b) Increased productivity and stable currency
Conflicting: increased productivity and efficiency promotes a
higher exchange rate; this conflicts with the goal of stable
currency, which is to stabilize the currency.

c) Stable currency and a viable balance of payments

Complementary: stable currency promotes a currency in
foreign money markets, this compliments the goal of a viable
balance of planets which is to balance imports and exports. If
there is stable currency in foreign money markets, then this
will promote a balanced import and export rate.

d) Economic growth and reduced public debt

Complementary: reduced public debt provides a
complementary environment for economic growth; this is
because with reduced public debt reduced interest rates and
consumer goods.

e) Increased productivity and environment stewardship

Conflicting: increased productivity and efficiency promotes
the most efficient or wise use of productive resources with
disregard to how the productive resources are used. This
directly conflicts with the goal of significantly harming the
environment.

f) Reduced public debt and fair disruption of income

Complimentary: Reduced public debt promotes lower interest
rates and consumer prices; this compliments fair distribution
of income because both goals support people of lower
income.

g) Political stability and economic freedom

Complementary: Political stability provides an environment
necessary for economic growth, while economic freedom
promotes the principle of consumer sovereignty; this also
provides an environment necessary for economic growth.
Therefore, both goals are complementary to one another.
2. What effect do regional differences have on the equitable
distribution of income in Canada?
The effect that regional differences have on the equitable
distribution of income in Canada is that average employment
incomes for residents of Ontario are statistically higher than for
people who live in the Atlantic provinces.

3. Explain how both inflation and deflation are generally bad

news for the Canadian economy.
Both inflation and deflation are generally bad news for the
Canadian economy because they are symptoms of an unhealthy
economy. Periods of inflation erode the dollar's purchasing power
and raise the cost of living for Canadians on fixed incomes..
Deflation is commonly associated with periods of great economic
crisis.

4. Explain why the principle of consumer sovereignty is

important in a market economy.
The principle of consumer sovereignty is important in a
market economy because consumers should be free to determine
what goods and services are actually produced through their
purchasing deductions, alongside the ability to purchase goods and
services at their own discretion.