As the economy is dynamic system, she(it) has capacity to escape severe shocks. Frequently she(it) grows too slowly to supply(ensure) the full-time job, and sometimes too fast to have low level of inflation. Actually it also is traditional interdependence in economy: or you have low inflation and high unemployment, or high level of inflation and low unemployment.



And that is why. Speak, that economy Is heated, when the demand sharply grows, and the prices of goods grow. It also is inflation, when the money supply increases, and the amount of the goods and services remains at a former level. When the demand advances capacities, the prices of goods automatically begin to grow. Also manufacturers and sellers know, that can increase the prices, when the demand is high.

However light party it is that unemployment in such periods low, as the enterprises employ more working to expand the productions. So that during revival of economy and specially in economy specially it is noticeably stress of inflation, but low rate of unemployment. When occurs (Cool-off) of economy, that is recession, demand drops. When the demand drops, certainly, the buyers any more so have a lot of money to purchase the goods in former amounts. The not sold out oddments so that are formed, the inflation is reduced.

Defect it is that the amount of jobs also is moderated. You see it is not necessary to make the goods any more, the demand for which one drops. So that we have low level of inflation, but high unemployment. That it is necessary, so it is a golden mean. The firm prices and stable employment are necessary to us. But as the economy is dynamical, she(it) sometimes leaves from desirable balance. And the role of government is reduced balancing it.

As the federal budget consists of two parts - taxes and costs, the government has four instruments of budget policy. It can be increase either decrease(reduction) of costs or increase or decrease(reduction) of an amount of tax receipts. If the government augments costs, it warms up economy. Why? Because it will augment argument. It augments demand and introduces the contribution to growth. Due to this money to the accounts (invoices) of firms and companies and in bins of the consumers acts. Use of expenditures on public account with the purposes of growth of economy is called as budget urging.