Answer to Question #93724 in Macroeconomics for bongi

Question

The core elements of the Growth Employment and Redistribution (GEAR) strategy of the South African government in 1996, under the leadership of the then finance minister Trevor Manuel were amongst other things:
 budget reform to strengthen the redistributive thrust of expenditure
 monetary policy to prevent a resurgence of inflation
 a reduction in tariffs to contain input prices and facilitate industrial restructuring, compensating partially for the exchange rate depreciation
1.1 With reference to the above, identify the macroeconomic objectives in these elements. (3 marks)

Answer 1

1) macroeconomic objective: redistribution of government spending and more efficient use of budget funds, maintaining a foreign trade balance.

2) macroeconomic objective: containment inflation, stable price level

3) macroeconomic objective: industrial sector support, stable growth in national output