Paragraph 2 Economic Growth Is Estimated To Have Been 6 In 2019 Owing To Continued Strong Performance Mainly In Serv 1 (26.11 KiB) Viewed 29 times
Paragraph 2 Economic Growth Is Estimated To Have Been 6 In 2019 Owing To Continued Strong Performance Mainly In Serv 2 (12.62 KiB) Viewed 29 times
Paragraph 2 Economic Growth Is Estimated To Have Been 6 In 2019 Owing To Continued Strong Performance Mainly In Serv 3 (7.59 KiB) Viewed 29 times
Paragraph 2: Economic growth is estimated to have been 6 % in 2019, owing to continued strong performance mainly in services, but also industry (apart from oil mining) and agriculture. The oil and gas sector was in decline, although at a slower rate than in the previous year. Revenues from oil and gas were estimated to have declined by 1.3 %, relative to a decline of 13.1 % in 2018. The sharp decline in oil prices since the third quarter of 2019 has posed major challenges to the country's current account balance and public finances. Oil contributes close to 90 % of export revenues and roughly 75 % of the country's total budget revenues.
Paragraph 4: The central bank of Urbania raised its base interest rate to 14% in July 2019. It was th second rate increase in the year. In addition, the inflation rate kept its upward trend and reached 16.5 % in June, the highest since 2010.
(e) Using a monetarist/new classical AD/AS diagram, explain whether the economy of currently experiencing an inflationary gap or a recessionary gap (Text 1, Paragraphs 2 a marks]
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