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This will immediately decrease the funds of lending countries. And most importantly, this situation with the sovereign risk is not only characteristic to Greece, but to various other countries, including the United States. "More especially, the IMF is concerned that higher sovereign risk in countries like Greece can spill over to domestic banking systems and across borders, thereby triggering a second global economic crisis. It is also important to note that sovereign risk is not confined to Greece, but there are a number of other global more systemic important countries that fall into this category, including the world largest economy, the U.S.A." (All Africa, 2010).
In terms of the immediate impact, this would be most obvious within the neighboring Balkan countries. Greece is one of the largest investors in the Balkan region as well as one of the greatest donors. When its economic problems hit, the country's investments and donations…
Fotiadis, a., 2010, Greek crisis impacts the Balkans, IPS, http://ipsnews.net/news.asp?idnews=50734 last accessed on June 22, 2010
2010, the World Factbook -- Greece, Central Intelligence Agency, https://www.cia.gov/library/publications/the-world-factbook/geos/gr.html last accessed on June 22, 2010
2010, Will the Greece economic crisis affect Namibia? All Africa, http://allafrica.com/stories/201005170465.html last accessed on June 22, 2010
2010, Why Greece's economy should matter to everyone, Boston, http://www.boston.com/business/articles/2010/05/07/why_greeces_economy_should_matter_to_everyone / last accessed on June 22, 2010
The economic stimulus
Because of the 9% unemployment rate overall, many epublican campaigns are touting the fact that their opponents voted for the stimulus as a reason to vote against him or her: whether the stimulus failed is an open question -- it certainly created some jobs, although not as many as hoped. Critics to Obama's left have alleged that it was not large enough, like Noble-prize winner Paul Krugman, in a New York Times editorial: "[The] modest rise in federal spending was barely enough to offset cutbacks at the state and local level" (Thrush 2010, p.1).
The Obama Administration's $700 billion Troubled Asset elief Program (TAP) brought the economy back from the brink and "there are clear signs that aspects of the financial system are far more stable than they were at the height of the crisis in the fall of 2008" (Orol 2010). But the fact…
Orol, Ronald (2010, January 31). TARP overseer says bank bailout program has mixed results.
Market Watch. Retrieved November 1, 2010 at http://www.marketwatch.com/story/overseer-bank-bailout-program-has-mixed-results-2010-01-31
Thrush, Glen. (2010, November 1). Was the stimulus Barack Obama's original sin? Politico.
Retrieved November 1, 2010 at http://www.politico.com/news/stories/1110/44469.html
Sunday Alcohol Sales and Blue Laws
Of all points made in this section, the abolishment of blue laws in 11 states in the last 2 1/2 years and the sales of alcohol in two-thirds of all states on Sunday shows how legislation, over time, changes to reflect the dominant political and ethical thought of the time. The decision on the part of state and county governments to open up Sundays has more to do with their need for tax revenues and less about the conflict with the Christian Sabbath (Hanson, 2010).
The most insightful section of the article, the series of resources provided here include interesting insights into how alcohol spending continues to increase as a result of advertising and promotion efforts over time. This section also provides an assessment of how the multichannel marketing strategies of companies is also changing significantly over time, leading to more effective…
Hanson, David . (2010). Economic issues in alcohol: marketing, business & money. Alcohol Problems and Solutions, 1(1), Retrieved from http://www2.potsdam.edu/hansondj/controversies/1116952343.html
Economic Issue in Health Care
Inflation affects all the segments of an economy; including individuals, businesses, and governments in a number of ways. The healthcare industry also takes its impacts on each and every aspect of its operations; like consumer spending, costs of operations, demand and supply of medical treatments, medicines, and general healthcare services, etc. The purpose of this paper is to evaluate the impact of an important economic issue, Inflation on the healthcare using demand and supply and cost analysis as the two important economic tools. The paper starts with a brief introduction to the economic issue 'inflation' as it relates to the healthcare industry and proceeds by introducing and discussing the chosen economic tools (demand and supply and cost analysis) to evaluate the impacts of this current economic issue on healthcare. The paper concludes by highlighting the major points from the analysis and discussion.
Inflation: an important…
Mangan, D. (2013, 06, 18). Health-Care Cost Inflation on Track to Slow in 2014: Report Retrieved on August 21st, 2013, from
Nussbaum, A. (2012, 05, 21). Health-Care Costs Rise Faster Than U.S. Inflation Rate. Retrieved on August 21st, 2013, from
PricewaterhouseCoopers LLP, (2013). Factors affecting 2014 Medical Cost Trend. Retrieved on August 21st, 2013, from
Rugy, V. (2013, 07, 16). Is The Slowdown In Health Care Inflation Here To Stay? Retrieved on August 21st, 2013, from
economic issue prevailing in the United States is that of rapid fiscal and monetary stimulus and its inflation implications. Currently, due in part to prevailing market conditions, governments have embarked on a path to massive fiscal ease. Governments, including the United States, Japan, Europe, and China have all engaged in massive stimulus operations. These operations are designed to help build consumer confidence while also enhancing the overall appeal of risky asset classes. For instance, the United States has kept interest rates near 0% for the past two years with an expectation of low interest rates until 2015. This low interest rate environment makes alternative assets such as stock, bonds, and real estate more attractive on a relative basis. High dividend paying stocks for instance, offer a yield of roughly 3% which is nearly double that of the 10-year treasury. These massive stimulus efforts however, have yet to enhance economic activity…
1) Robert J. Gordon (1988), Macroeconomics: Theory and Policy, 2nd ed., Chapter 22.4, 'Modern theories of inflation'. McGraw-Hill.
2) Tobin, James, American Economic Review, march (1969), "Inflation and Unemployment
It is clear that compliance with taking medication needs to be increased within this population but this is a difficult thing to do. Putting them in a 'home' or an in-patient residential treatment facility is a short-term fix but will not help them when their treatment is over and they still have no home to live in and no money with which to purchase their medications. Compliance can be best increased in two ways: 1) make medications for these people extremely affordable and 2) combine the medication and/or treatment that they receive with other services that can help these individuals find jobs, inexpensive but decent housing, and social networks that can help them to reach out to others that have struggled or that are still struggling. Support is very important to those that have a mental illness and this support might be one of the best things that these individuals…
branches of democratic governments create a balance of power, disallowing any one branch to amass or wield disproportionate power. Branches of government also ensure role clarity and stability in the separation of powers. Each branch serves a role, and that role is mitigated by the roles of the other branches. The executive branch of the government refers to the heads of state in charge of implementing the policies and laws enacted by the legislative branch. An executive branch typically performs roles not expressly or officially outlined such as administering to the people, providing public relations services, and serving as figurehead. For instance, an executive branch of government presumes powers related to not only executive, authoritative decisions but also matters linked to foreign affairs and macroeconomic concerns.
The legislative branch of government concerns itself primarily with the execution and creation of laws, policy, and legislation. Laws, policy, and legislation tend to…
Interestingly, it seems that this feature remains relatively constant regardless of the level of the socioeconomic spectrum. That is fascinating to anybody who comes from a foreign community where Americans are envied and believed to be so much more fortunate than many of us in the rest of the world.
Finally, in that regard, I also anticipate that studying the ethical issues and legal concepts that apply to economic practices, including the intersection between the private business sectors and government. From my perspective, it seems that there are many potential areas of study just in the manner in which the consumerism mentality in the U.S. fueled the housing market bubble and the ways that big business interests profited from those impulses at the macro level while, in effect, destabilizing the entire national economy. Likewise, at the micro level, there is much to learn from the practices of individual lending institutions…
My intended major is Economics, a subject in which I developed an interest in two very different ways. At the level of microeconomics, I have first-hand experience with the challenges of surviving alone in the United States as a self-dependent international student. On one hand, the U.S. offers many potential opportunities; on the other hand, economic survival for working students requires very responsible management of finances and resources. On the level of macroeconomics, I was both alarmed and fascinated by the manner in which the entire U.S. economy nearly collapsed in 2008, just as I was beginning to settle into life in the U.S. In addition to issues of the highly complex interrelationships among and between the business, investment banking, and housing sectors, the situation also highlighted important ethical issues that obviously must be addressed to prevent repeated economic catastrophes.
As a student of economics, I hope to develop a basic understanding of the classic fundamental principles in the field. However, I also hope to study some of the broader ways that economic issues affect and even shape contemporary human societies. Since coming to the U.S., I have learned that the American consumer economy is much more complex than I realized, especially in connection with the extent of consumer dependence on credit to fund higher lifestyles than might be sound economically. Interestingly, it seems that this feature remains relatively constant regardless of the level of the socioeconomic spectrum. That is fascinating to anybody who comes from a foreign community where Americans are envied and believed to be so much more fortunate than many of us in the rest of the world.
Finally, in that regard, I also anticipate that studying the ethical issues and legal concepts that apply to economic practices, including the intersection between the private business sectors and government. From my perspective, it seems that there are many potential areas of study just in the manner in which the consumerism mentality in the U.S. fueled the housing market bubble and the ways that big business interests profited from those impulses at the macro level while, in effect, destabilizing the entire national economy. Likewise, at the micro level, there is much to learn from the practices of individual lending institutions and real estate brokerages and their exploitation of individuals and families brought up on the American dream of home ownership. I hope that my introductory studies in economics will help me identify a more specific academic focus in an area that will allow me to establish a career, ideally in a field that might contribute to resolving some of the systemic economic problems in human societies.
Economic Events: 1980-1989
the decade of greed. The era of onald eagan when the rich got richer and the poor got poorer. Despite this common wisdom, 1980 started off auspiciously. On May 8, 1980 the World Health Organization hailed "one of the century's greatest medical accomplishments," the final and total eradication of smallpox (Dickson 247). But how quickly times change - barely a quarter century has passed and this same disease is making headlines once again.
Attitudes change also. While many in this day and age would still agree that the 1980's was a selfish period in American history, a sea-change has occurred in the rhetoric issuing forth from Washington D.C. In a very fundamental way, party politics has been thrust aside as concerns for homeland security take precedence over petty partisanship. Michael Barone notes this in his analysis of a speech made by Democrat ichard Gephardt in the Summer…
Barone, Michael. "The loyal opposition." U.S. News and World Report. 13 June 2003. 14
March 2003 http://www.usnews.com/usnews/opinion/baroneweb/mb_020613.htm.
Case, Karl E., and Ray C. Fair. "Principles of Economics." Prentice Hall, Inc. Englewood
Cliffs, NJ 1992.
The downward spiral of deflation, the collapse of countless banks and other financial institutions, and the unprecedented levels of unemployment all demanded that something be done.
The programs that constituted President Franklin Delano Roosevelt's New Deal were not entirely unknown in the pre-Depression world. Various European countries already possessed social welfare schemes to some extent, but in the United States this was largely new thinking. The changes wrought by the New Deal reflected as much the uniqueness of conditions during the Great Depression as they did the undercurrent of new attitudes and ideas that had gradually been taking hold among America's intellectuals.
FDR's planners acted in the context of changing values, an evolving set of institutions, shifting political and economic circumstances, and the ebb and flow of planning opportunities to create a distinctly national, American form of planning.... They were part of a wide-ranging national debate over how to create…
DUMMY CITATION #1 G.M., Blaauw, G.A., and Brooks, Jr., F.P. "Architecture of the IBM System/360," IBM Journal of Research and Development, Vol. 44, No. 1/2, IBM, January/March 2000 [Reprint of IBM Journal of Research and Development, Vol. 8, No. 2, 1964.]
DUMMY CITATION #2 Anderson, Philip, and Michael L. Tushman. "Technological Discontinuities and Dominant Designs: A Cyclical Model of Technological Change." Administrative Science Quarterly 35.4 (1990): 604fl.
Gibbons, Jim. "Gibbons Tells Congressional Committee to Abolish Arbitrary FAA Retirement Age: Nevadan Calls Current Federal Rule, 'Blatant Age Discrimination.'" Press Release, (United States Congress, Washington D.C., 12 March, 2003).
Wilkening, Robin. "The Age 60 Rule: Age Discrimination in Civil Aviation." (No Date). URL: http://aeromedical.org/Articles/age60.html.
t is explained that the "fiscal cliff" itself refers to the end of Bush-era tax cuts and large spending cuts that will occur at the end of the year if Congress can't agree on a way to cut $1.2 trillion in debt over the next decade. This would lead to income tax and payroll tax increases for almost everyone, with an immediate negative impact on spending and thus on the economy, and with a rising unemployment rate through 2013. The article also cites Ben Bernanke as saying the Fed would not be able to counter or even effectively mitigate the effects of going over this cliff, yet the politics will have to play out before any action is taken by anyone.
lluminating the issue still further, John D. McKinnon, Kristina Peterson, and Josh Mitchell's "Most Households Face 'Fiscal Cliff'" from the November 21st edition of the Wall Street Journal present…
Illuminating the issue still further, John D. McKinnon, Kristina Peterson, and Josh Mitchell's "Most Households Face 'Fiscal Cliff'" from the November 21st edition of the Wall Street Journal present personal stories that typify the impact the fiscal cliff would have for people on various rungs of the socioeconomic ladder. Describing the various tax increases and other effects of the fiscal cliff in general terms first, this article then gives an example of an individual that meets the general description for every basic income/economic bracket identified. A human face is put on the numbers and the rhetoric that have been occupying many headlines and stories in the news over the past months, making the subject more accessible.
The same edition contained another story by Jon Hilsenrath, "Fed Still Trying to Push Down Rates," which details Bernanke's pledge to try to keep interest rates low through 2013 to stimulate the economy. Background information on ongoing unemployment and the dangers of the fiscal cliff are given, and also provides some history of central banks responding to legislative efforts in a spirit of cooperation but not coercion. The article also cites Bernanke's repeated warnings regarding the fiscal cliff and other fiscal policies that portend danger to the U.S. economy (and to the world economy at large), and the need to move beyond partisan politics to arrive at real and lasting solutions for the economy.
These articles demonstrate the ongoing problems faced in the current U.S. economy and contended with by agencies such as the Fed and large government bodies such as Congress. The individual personalities involved also appear to be of importance, and possibly of great hindrance.
Bush implied unemployment figures were declining and Kerry touted very high unemployment figures. In hindsight, it appears that the labor department statistics concurred with the Kerry camp. When Bush still won, unemployment trend indicators seem to be coming true now and there seems to be more problems on the horizon for the economy. The Bureau of Labor Statistics indicated recently that new jobs being created in the economy were the types of jobs that cannot fuel economic growth. Thus, the economy is and will continue to lose jobs to cheaper labor markets around the globe.
The Federal eserve has dictated the cost of capital for businesses to borrow. Trends show that cash shortages in corporate American are increasing and borrowing heavily will be a likely result. Therefore, future actions of the Federal eserve impacts a major aspect of America's future. Trends to observe by the Fed relate to consumer consumption…
Employment Situation Summary. Ed. Bureau of Labor Statistics. 12/3/2003. Department of Labor. Retrieved on 4/13/2005, from http://www.bls.gov/news.release/empsit.nr0.htm .
Heilbroner, Robert, & Thurow, Lester (1982). Economics Explained: Everything You Need to Know About How the Economy Works and Where it Is Going. Englewood Cliffs: Prentice Hall.
Marx, Karl (1977). Capital, Volume 1. New York: Random House.
Marx, Karl (1978). Capital, Volume 2. New York: Random House.
Another fiscal policy that could be implemented is for the government to spend more, thereby increasing aggregate demand. This may have an impact on consumer confidence about the long-run state of the economy, but those long-run concerns are not driving consumer spending today. At this time, the spending policy is something that government can pursue. If poorly targeted, however, its impacts will be temporary. Indeed, if everybody knows that the measure is temporary, this will not affect consumer confidence or business investment in the long run. However, if the policy appears permanent, then the responses could be more permanent in nature as well.
Lowering taxes on that bottom 80% will increase consumer spending, but again might not improve consumer confidence because it only makes the long-run deficit problem worse. Only spending on job creation, therefore, is recommended because it serves to a) address some of the crippling issues relating to…
Many businesses could no longer operate in this fashion and likely closed their doors leading to a rise in unemployment. This is an example of the rule that Hitler had on the Pre-World War II German economy. The people of the nation were completely subject to his policies and because the economy was in such a vulnerable position as a result of the First World War, that Hitler's policies were looked upon as providing assistance to the nation. The research indicates that Hitler's rule over Germany managed to counter the rise in unemployment with institution of the German Labor Service and other workforce and labor programs.
Pre-World War II Unemployment in Germany
etween January 1933 and July 1935 the number of employed Germans rose by a half, from 11.7 million to 16.9 million.
. Under the rule of Hitler, more than 5 million new jobs paying living wages were created.…
Academic Dictionaries and Encyclopedias. "Expulsion of Germans after World War II." Last
updated in 2010. http://en.academic.ru/dic.nsf/enwiki/38667 .
Brezina, Corona. The Treaty of Versailles, 1919: A Primary Source Examination of the Treaty
That Ended World War I. New York: Rosen Publishing Group, Inc., 2006.
Not only are they crucial for the movement of people, but they are crucial for the rapid movement of time-sensitive goods. Therefore the government has an interest in the survival of the industry. Government can and has involved itself through monetary policy in sustaining or resuscitating struggling airlines in order to maintain the overall strength of the industry.
Taxation is another area where governments affect the industry. This again relates to the tight margins, as taxation represents a key expense for airlines. Changes in the tax regime directly affect airlines' after tax profits. The government can encourage or discourage the industry based on its taxation policies. The IATA believes the airline industry to be more heavily taxed than some of its substitutes, and has an entire program to deal with the issue of taxation, highlighting taxation's relevance to the industry.
Another way in which fiscal policy can impact the industry…
Pearce, Brian. (2008). Financial Forecast. IATA. Retrieved June 29, 2008 at http://www.iata.org/NR/rdonlyres/DA8ACB38-676F-4DB1-A2AC-F5BCEF74CB2C/0/Industry_Outlook_Briefing_March08.pdf
No author. (2008). The Industry Handbook: The Airline Industry. Investopedia. Retrieved June 29, 2008 at http://www.investopedia.com/features/industryhandbook/airline.asp
Flint, Perry. (2008). 2008 Forecast: Will the Luck Hold? Air Transport World. Retrieved June 29, 2008 at http://www.atwonline.com/channels/dataAirlineEconomics/article.html?articleID=2174
No author. (2008). Chief Characteristic of the Airline Business. Air Transport Association. Retrieved June 29, 2008 at http://members.airlines.org/about/d.aspx?nid=7955
Growth The retailer sector was lately affected by the back-to-school shopping season, which did not start so well, as midprice department stores, discounters and specialty-apparel retailers announced disappointing sales results during August, which reinforced the already much debated concerns that consumers are not comfortable with the current state of the economy and are reluctant to consume, considering the shaky and uneven economic recovery.
However, luxury department-store chains managed to post significant earnings, as they benefited from the help of an important number of upscale shoppers. Still, the effects of higher gas prices and the rising value of grocery bills, combined with lackluster job growth were severely felt by moderate- and lower-income shoppers.
Michael Niemira, chief economist and director of research at the International Council of Shopping Centers feels that "There's weaker-than-expected performance," due to the fact that "there was a slowdown in spending, but some results are exaggerated by…
1. Higher energy prices depress overall economy. Charles Stein.
Knight Ridder Tribune Business News. Washington:
Aug 6, 2004. On the Internet at http://gateway.proquest.com.libproxy.unm.edu/openurl-url_ver=Z39.88-2004&res_dat=xri:pqd&rft_val_fmt=info:ofi/fmt:kev:mtx:journal&genre=article&rft_dat=xri:pqd:did=000000674708321&svc_dat=xri:pqil:fmt=text&req_dat=xri:pqil:pq_clntid=2877
2. Retailers' Sales Come In Weaker Than Expected; Soft Results Reinforce Fears About Consumer Confidence; Discounters Saw Biggest Hit. Kortney Stringer.
These can include the stimulus package, though, because the Obama Administration is still offering stimulus dollars to banks and other companies that need help and cannot take care of their customers in the way that they used to and preferred to.
Figure 1: How Severe is the Subprime Mess?
Obviously, the subprime mess is a serious concern for everyone. The stimulus package was designed to help the banks and the people who borrowed from them with the fact that they could not pay for the debts that they had created for themselves. That was true for the people who had mortgages, and also true for the banks that loaned money to these people. The stimulus package was designed to help them both out so that they could take care of their debts and move forward again. However, the economic stimulus package has not fixed everything that was hoped. There are…
Anderson, Mark (2009-06-30). "Down in flames: Why Money Store was a bust." Sacramento Business Journal. American City Business Journals, Inc.
"Bank vows $20 billion for green projects." msnbc. 2008-02-06. http://www.msnbc.msn.com/id/17500301/ .
"Credit Cards' Latest Pitch: Green Benefits." Wall Street Journal. 2007-11-30. http://online.wsj.com/article/SB120225763311445823.html .
Freer, Jim (2007-03-09). "BofA donates $1M to Camillus House." South Florida Business
Aside these impacts however, more salient effects are observable, such as a necessity to change internal practices of business. A relevant example in this sense is given by Wal-Mart, in its quality of America's largest retailer, which decided, unlike within the U.S., to allow Chinese employees to unionize (Dessler, 2006). The official approach of the Chinese leaders was that of implementing reforms which further capitalize on the low cost labor force advantage in order to continually attract investors.
5. The Market of Exchange ates
The final step of this analysis is constituted by the look at China's currency policies, in an attempt to reveal if the policies implemented have played any part in the country's competitiveness within the global market. China's currency, the yuan, was pegged to the United States Dollar in 1997, but the link only lasted until 2005. Since then, the mechanism of resetting the value of the…
Brasher, K., 2005, China's Opaque Currency Policy, the New York Times, http://www.nytimes.com/2005/07/22/business/worldbusiness/22assess.html last accessed on October 21, 2009
Bruton, G.D., Ahlstrom, D., Chan, E.S., 2000, Foreign Firms in China: Facing Human Resources Challenges in a Transnational Economy, SAM Advanced Management Journal, Vol. 65
Buckley, P.J., Clegg, J., Wang, C., 2002, the Impact of Inward FDI on the Performance of Chinese Manufacturing Firms, Journal of International Business Studies, Vol. 33
Cavanaugh, J., Mander, J., 2004, Alternatives to Economic Globalization: A Better World Is Possible, 2nd Edition, Berrett-Koehler Publishers, ISBN 1576753034
Economics: Goods, eturns, & Applied Theory
There are a variety of good available on the market. Different goods serve different functions within a society's economy. In this brief paper, two types of goods will be discussed: normal goods and inferior goods. The paper will also make mention of the law of diminishing returns and will provide examples of each of the three topics. Finally, drawing directly from contemporary news, the paper will reflect upon an economic issue relating it to concepts recently acquired through the course content.
Contemporary News in Economics: Goods, eturns, & Applied Theory
As the market improves and more people generate greater quantities of income, there are certain products that people demand more because of the increase in their incomes. These are the items that are popular and that many people desire yet the price is just out of their economic means. Once these people generate…
Vega, T. (2012) Substantial Growth in Ads Is on the Way to FaceBook. The New York Times, Available from http://www.nytimes.com/2012/03/01/business/media/facebook-paves-way-for-huge-growth-in-advertising.html?ref=technology . 2012 February 29.
disrupting America's economic system is a fundamental objective of terrorists
Even as the world continues to struggle with the terrible shock from the September 11 attacks in New York and Washington, one principle lesson has already become clear: disrupting our economic system is a fundamental objective of terrorists.
Prior to September 11, our economic environment was certainly not immune to terror, in comparison to many other nations; we lived relatively terror-free. Now, however, the aftermath of the terrorist attacks serves as a grim reminder that international relations and security developments can dramatically affect economic performance.
US History is replete with countless examples when macro fundamentals are overtaken by what economists refer to as, exogenous shocks -- surprise events that can profoundly and often unpredictably shift political and economic resources, and send even the most accurate forecasts astray. Commodity shocks, such as the two OPEC jolts in the 1970s, are classic…
Bagehot, Walter. 1927. Lombard Street: A Description of the Money Market, John Murray, London.
Balbach, Anatol B. 1981. "How Controllable is Money Growth?" Federal Reserve Bank of St. Louis Review, vol 63, no 4, April, p. 5.
Becker, Gary S, Steven N. Kaplan, Kevin M. Murphy and Edward A Snyder. (2002 / winter). "The Economic Effects of September 11," GSB Magazine, University of Chicago's Graduate School of Business.
Bell, Stephanie. 2000. "Do Taxes and Bonds Finance Government Spending?." Journal of Economic Issues, Vol. 34, no. 3, pp. 603-620.
Economics and Global Capitalism
The problem with the kind of thinking that postulates that human nature is based on self-interest is that underlying this supposition is the assumption that human nature is completely rational and logical and would never do anything to harm itself. This is not the case and economic booms and busts indicate as much. Self-interest is not always aimed towards a positive end. Sometimes, for instance, short-term self-interest is detrimental to long-term self-interest and vice versa. Sometimes people are motivated not by self-interest (at least in a temporal sense) but by charity, kindness, selflessness, self-sacrifice, or altruism. It could be argued that people sometimes believe they will be rewarded in a spiritual sense for these actions, but the basic idea is that they are essentially unselfish acts. Thus, to assert that self-interest is the rational motivating force behind human behavior is to really not understand humanity: humans…
The revelation of the financial crisis that unfolded in United States in 2008 is considered to be the worst economic crisis since the Great Depression, 1929. The distinctive causative factors that have contributed to the U.S. economic crisis 2008- 2009 are differentiated by aggravated financial control, higher risks in capital investment, the housing bubble phenomena in relation to the brisk credit expansion. The aggregation of these factors in the U.S. economy directed the economy towards the de- leverage and credit crunches as the bubble burst. The following paper shall be discussing about the degree of correlation between the tax implications policies with respect to the financial crisis in U.S.. The precise review of strong linkages between the taxation and economic crises is the explicit explanation of the crisis that shook America. The paper also highlights the key factors that demonstrated their abilities and rescued U.S. In the economic…
Carr, D.A. (2011). Responses to Local Fiscal Shocks: Path Dependency Effects of the Clean Air Act. Public Finance and Management, 11(2), 160+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5050180027
Hendrickson, J.M., & Nichols, M.W. (2010). Did Commercial Banks Close Branches in Low-income Neighborhoods in Response to the Cra? Implications for Understanding the 2007-2008 Financial Crisis. Journal of Legal, Ethical and Regulatory Issues, 13(1), 17+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5044499375
Johnson, E.M. (2010, April). Mr. Trust Buster. In These Times, 34, 7+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5041402599
Robinson, S.N., & Nantz, D.P. (2009). Lessons to Be Learned from the Financial Crisis. Journal of Private Enterprise, 25(1), 5+. Retrieved March 9, 2012, from Questia database: http://www.questia.com/PM.qst?a=o&d=5037768696
Economic Final Report
Types of economic systems
Economic systems vary from one nation to another. Traditional economic systems refer to an economic system founded by tradition. The services and goods that people provide through the work they do, how people exchange and use the resources are trends that follow permanent patterns. These are not dynamic economic systems because there are minimal changes. In this economic system, people live on static standards. They do not enjoy much occupational mobility and financial mobility (Gregory and Robert 19). However, it is possible to predict economic relationships and behaviors. People are aware of what they are expected to do, why they trade, they know what others should give to them. In traditional economic systems, the interests of the community are of great priority than individual interests. People collaborate at work and labor proceeds are shared equally. However, in some traditional economic systems, individuals respect…
Conklin, David W.; Comparative Economic Systems: Objectives, Decision Modes, and the Process of Choice. Cambridge [England: Cambridge University Press, 2009. Print.
Gregory, Paul R, and Robert C. Stuartl; Comparative Economic Systems. Boston: Houghton
Mifflin Co, 2010. Print.
Keese, Mark, Pete Richardson, and Ge-rard Salou. The Measurement of Output and Factors of Production for the Business Sector in OECD Countries: (the OECD Business Sector Database). Paris: OECD, 2011. Print.
If there is a risk that one of the family members will lose his or her job, that will add risk to the purchase decision. The riskier the purchase decision, the lower the price will need to be in order to compensate for that. Another factor here is the expected change in housing prices or interest rates. Buyers are inclined to enter the market if they believe that the cost of home ownership will be higher next year, but they may delay purchases if they believe that costs will be lower next year.
ith new home sales last summer, the dip could be in part due to worries about a double-dip recession. The summer was characterized by an inane fight over the debt ceiling, something that shattered confidence of many in the political system, and some of the key actors within that system. A fractured political system is one that…
Hauser, C. (2011, Aug 24). Sales of new homes fell again in july. New York Times, pp. B.6-B.6. http://search.proquest.com/docview/884825381?accountid=35812
Economic Crisis Policies
US current economic crisis is considered to be started from real estate sector. The real sector started to decline in 2006 and it accelerated in 2007 and 2008. Housing prices have fallen from the peak from about 25% so far. The decline in prices left homeowners with no option and they were unable to refinance their mortgages and causes default of mortgages. This default of mortgages and loans swallowed the banks and financial markets such as falling of Lehman's brothers and other anks and blow to rest of economy happened as the whole economy was relying on banks and ultimately it slows down investment in the country and capital flows to other parts of the world like China and India. ank losses cause reduction of bank capital which in turn requires capital reduction thus saving bank from lending. It is estimated that every $100 loss and reduction…
ISR international socialist review. (2009, april). Retrieved from The U.S. economic crisis:causes and solutions: http://www.isreview.org/issues/64/feat-moseley.shtml
Journal of accountancy. (2009, october). Retrieved from The U.S. economic crisis: root causes and road to recovery: www.journalofaccountancy.com/Issues/2009/Oct/20091781
Eyes on wall street. (2011, april). Retrieved from Levin coburn investigates casues of financial crisis: http://www.eyesonwallstreet.com/2011/04/articles/financial-crisis/levincoburn-report-investigates-causes-of-the-financial-crisis/
Rude, C. (2009). World Economic Crisis and Fed Reserve Response to it. Studies in Political Economy.
Total revenue represents all the company income. Total revenue is calculated by multiplying the price of products with the quantity sold. Typically, total revenue is calculated as follows:
Total revenue = price x quantity
Where price (P) and quantity (Q).
As being revealed in Table 1, total revenue is calculated by multiplying price with quantity, when firm produces 2 quantities of goods, firm's total revenue is $10, however, when a firm produces 3 quantities of goods, its total revenue is $15.
Marginal revenue is an additional revenue that a firm generates when a firm sells additional unit of output. The marginal revenue plays an important role in the perfectly competitive firm where a perfectly competitive firm maximizes its profit when marginal revenue is equal to marginal cost. The formula used to calculate marginal revenue is:
Marginal revenue= Change in total revenue/Change quantity.
The average revenue is calculated…
Aderton, (1977).Economics. Pearson Education
Sloman, A and Sutcliffe, M (2004). Economics for Business. Prentice Hall.
An economic system is basically described as specific set of principles that addresses the production, distribution, and consumption of products and services. The involved parties in the production, distribution, and consumptions processes are usually determined by or dependent on the economic system. Throughout the history of humanity, different types of economic systems have evolved because different societies have placed varying emphasis on distinctive goals and priorities as part of their efforts to obtain answers to certain economic questions. In addition, the difference in economic systems is fueled by the tendency by different societies to develop very broad economic approaches to manage their resources. One of the main reasons for the development of different economic systems is to address the challenge of scarcity. The challenge of scarcity is an essential problem that confronts individuals and nations. hile there are four major types of economic systems recognized by economists, there…
"Economic Systems." Hilliard Bradley High School. Hilliard Bradley High School, n.d. Web. 18 Mar. 2013. .
"Factors of Production." Enotes.com - Study Smarter. Enotes.com, Inc., n.d. Web. 18 Mar. 2013. .
"Types of Economic Systems." Economic Systems. Shmoop University, Inc., n.d. Web. 18 Mar. 2013. .
There are several factors that could contribute to increased demand for owner-occupied housing in the United Kingdom. Given that this demand is presently suppressed by a poor economy, most of the conditions under which demand would increase involve finding ways to boost overall economic performance. One normal policy prescription, lowering interest rates, is effectively off the table with the current rate at 0.5% and the Bank of England expected to maintain this rock bottom rate for the foreseeable future (Oxlade, 2013). Banks could lower lending rates to buyers, but these rates are usually based on spreads relative to the rate at which banks borrow, so there might not be much flexibility for banks to lower rates profitably.
One way would be to boost the economy through fiscal stimulus, government putting money into the economy instead of taking it out. This would create better demand conditions, and would also give…
Oxlade, A. (2013). Interest rates at 0.5pc for four more years. The Telegraph. Retrieved April 28, 2013 from http://www.telegraph.co.uk/finance/personalfinance/interest-rates/9922941/Interest-rates-predictions-Four-more-years-of-0.5.html
According to Burrow, Verard and Kleindl (2007), "a market economy is an economic system in which individual buying decisions in the marketplace together determine what, how, and for whom goods and services will be produced." Hence in any hypothetical pure market economy, the government of the day does not take an active role in deciding what products the citizenry should buy and in what quantities. A pure market economy is however taken to be a theoretical ideal. Burrow, Verard and Kleindl (2007) on the other hand note that "a command economy is an economic system in which a central planning authority, under the control of the country's government, owns most of the factors of production and determines what, how, and for whom goods and services will be produced." In such an economic system, the government of the day largely dictates the mode of utilization of the various factors of…
Baumol, W.J. & Blinder, A.S. (2011). Economics: Principles and Policy. Cengage Learning.
Burrow, J.L., Everard, K.E. & Kleindl, B. (2007). Business Principles and Management. Cengage Learning.
ealth does not equate to happiness, a sense of purpose, dignity or respect. One of the key underlying assumptions of neoliberal philosophy, as derived from Milton Friedman, is that financial wealth is the ideal end goal of all activity. hile financial wealth solves many problems it does not solve all problems. Opponents of globalization, whatever their other arguments, incorporate this understanding into their protestations.
Naomi Klein goes further, suggesting that the unequal wealth distribution in the globalized economy is deliberate. The march towards globalization is not an altruistic endeavor borne of a firm belief in the power of the free market, but is a calculated strategy on the part of the world's elite to seize the world's wealth and power at whatever expense is necessary. Indeed, any economic benefits realized by the masses are incidental. Casualties -- be they citizens of Iraq, indigenous peoples or indeed any of the world's…
Harvey, D. (2007). A Brief History of Neoliberalism. New York: Oxford University Press.
Klein, N. (2007). The shock doctrine: The rise of disaster capitalism. Toronto: Random House.
Friedman, T. (1999). The Lexus and the olive tree. New York: Farrar Straus Giroux.
Appiah, K. (2006). The case for contamination. New York Times Magazine. Jan 1, 2006.
This program is focused onto the following directions:
Generating stability with exchange rates
ebuilding confidence in the monetary policy
Better managing and restricting public debt
eforming and restructuring the banking sector to insure more transparency and the implementation of internationally recognized policies (The Icelandic Government Information Center, 2008).
4. Short-term forecast for the economy
The 2008 has severely impacted the Icelandic economy. In light of the dramatic effects as well as the efforts put into the reconstruction and reconsolidation of the Islanding economy, major growths are not expected. In other words, it is generally assumed that the country will regain its stability through small and gradual victories, which will, for the time being, only manage to stabilize the economy. Growth rates are expected to remain low and for 2010 for instance, the growth rate of the gross domestic product is expected to be close to zero (Central Intelligence Agency, 2010).…
2008, Economic programme in cooperation with IMF, The Icelandic Government Information Center, http://www.iceland.org/info/iceland-imf-program / last accessed on August 2, 2010
2008, Economic outlook 2008-2012, Landsbanki, http://www.landsbanki.is/Uploads/Maillist/Docs/economicoutlook2008-2012.pdf last accessed on August 2, 2010
2008, Glitnir releases economic forecast for Iceland, IceNews, http://www.icenews.is/index.php/2008/06/02/glitnir-releases-economic-forecast-for-iceland / last accessed on August 2, 2010
2010, Iceland economic statistics and indicators, Economy Watch, http://www.economywatch.com/economic-statistics/country/Iceland / last accessed on August 2, 2010
S. The societal system practiced in France serves as a model towards which the U.S. aspire.
President Barack Obama's healthcare reform plan is considered by many as being a socialist experiment that will significantly hurt the economy (CBS, 2009). In opposition, the President has stated that he does not intend to implement a healthcare system that depends on the government. Instead, he would prefer a system in which the government competes with private insurance companies for selling coverage.
The Invisible Hand Principle
The invisible hand principle was developed as an opposition to the protectionist system. This principle is actually a metaphor describing the self-regulating characteristic of the market. In other words, such a system can be implemented due to a combination of factors, like self-interest, competition, supply and demand. Adam Smith, who developed this theory, considered that the action of these forces and their effects are able to allocate resources…
1. Eddlem, T.R. (2009). Obama needs to learn "opportunity cost." The New American. Retrieved February 26, 2010 from http://findarticles.com/p/articles/mi_m0JZS/is_15_25/ai_n32369481/?tag=content;col1 .
2. Dorrien, G. (2009). Is the Economic Crisis a Sin? Newsweek. Retrieved February 26, 2010 from http://www.newsweek.com/id/206095.
3. Steele Calls Obama Health Plan "Socialism" (2009). CBS News. Retrieved February 26, 2010 from http://www.cbsnews.com/stories/2009/07/20/politics/main5174417.shtml .
4. Remarks by the President on Financial Rescue and Reform. The White House. Retrieved February 26, 2010 from http://www.whitehouse.gov/the_press_office/Remarks-by-the-President-on-Financial-Rescue-and-Reform-at-Federal-Hall .
Thus, a region or nation experiencing economic depression will be unable to use the interest rate lever to boost the economy. Similarly a country with high inflation will be unable to independently raise interest rates to contain inflation. Moreover, Islamic countries, which form a large part of the geography, do not believe in interest rates.
Political barriers -- Political differences between nations make it extremely difficult for them to adopt a common currency. It can lead to a loss in political sovereignty as monetary interests would need to surpass political interests. This is unlikely to be acceptable to most of the nations and the idea of a single currency may be difficult to implement (Gimp, 2008).
Will Pros and Cons change Over Time? Depending On the Country?
The economic conditions to determine a monetary union depend on: the openness and size of the economy involved to trade; the free movements…
BBC. (1997, November 21). European monetary union - pros and cons. Retrieved May 11, 2009, from BBC News: http://news.bbc.co.uk/1/hi/special_report/single_currency/25081.stm
Filho, F.F. (2003). Is it possible to achieve a monetary union in MERCOSUR? (South America). Retrieved May 11, 2009, from Vanderbilt University: http://sitemason.vanderbilt.edu/files/egnZLy/Ferrari%20Filho%202.pdf
Frankel, J. (1999, August). No single currency regime is right for all countries or at all times. Retrieved May 11, 2009, from Princeton University: http://www.princeton.edu/~ies/IES_Essays/E215.pdf
Gimp, F. (2008, June 27). A world currency - pros and cons and can it become a reality. Retrieved May 11, 2009, from Piponomics: http://www.babypips.com/blogs/piponomics/a_world_currency_pros_and_cons.html
He would be faced with deciding whether he must spend all his available resources on goods or services, or whether he must save some of his income so that he would be able to finance some of his needs of his future. When he is taken as a labor resource, he must make the decision whether he must use his time in working for his pay, or whether he must spend it on sleeping and other leisure time activities. ("Decision making using marginal analysis," n. d.)
Similarly, when he is a labor resource, he must decide how much of his time he must spend on education, so that he may be able to maximize his life earnings. On the other hand, if he were an entrepreneur, then he must make the decision on how many people he must hire, or how much he must spend on acquiring a new product…
Evans, Edward. (2005) "Marginal analysis, an economic procedure for selecting alternative technologies/practices." University of Florida, Institute of Food and Agricultural Sciences. Retrieved 15 December, 2007 at http://edis.ifas.ufl.edu/FE565
Johnson, Paul. M. (2005) "Marginal Analysis: A glossary of political economic terms" Retrieved 15 December, 2007 at http://www.auburn.edu/~johnspm/gloss/marginal_analysis
McConnell, Campbell R; Brue, Stanley L. (2005) "Economics, principles, problems and policies" McGraw-Hill Professional.
McEachern, William a. (2006) "Macroeconomics, a contemporary introduction" Thomson
The need for the preservation of these resources is because of the fact that it is finite or limited. Abused utilization of these resources will deplete it and will eventually endanger the future inhabitants of the earth, leaving them nothing for the production of their own needs. Without the resources, there will be nothing to work on in the first place. Achievement of economic stability is the first step in order to achieve the other social goals. Since there are resources, there can be economic efficiency whereby goods can be produced at a lowest possible cost because of the availability of resources. Economic freedom or the right of a man to engage in voluntary economic activities, economic equity or justice particularly in terms of taxation and welfare economics, and economic security or security in employment can be settled between the government and the people in order to achieve them. All…
Energy costs increased substantially and the yen's exchange rate was shifted to a floating rate. The eventual recession reduced expectations of future growth and reduced private investment. Economic growth went down from 10% to 3.6% during the period 1974-79 and to 4.4% in the decade of the 80s. ut despite the oil crisis and its consequences, Japan's major export industries stayed competitive through its cost-cutting policy and increasing efficiency. It reduced industrial energy demands and allowed the automobile industry, along with other industries, to improve. y the late 70s, the computer, semiconductor and other technology and information-intensive industries entered a period of rapid growth. During this high-growth era, exports continued to support Japan's robust economic growth in the 70s and in the 80s. However, the problems encountered on account of its growing balance of payments surplus urged for the opening of domestic markets and a stronger focus on domestic demands…
Answers.com. (2007). Shigeru Yoshida. 4 pages. Encyclopedia Britannica: Answers Corporation
Bernier, B. (1980). The Japanese peasantry and economic growth since the land reform of 1946-47. 40 pages. Vol 12 issue 1. Bulletin of Concerned Asian Scholars: Questia Media America, Inc.
Luu, L.T. et al. (1996). Summary report on Japan. Team # 6. Chinman: University of Hawaii..
Retrieved March 14, 2007 at http://www2/hawai.edu/~chiman/file2,htm
When unemployment is high, companies may decide to delay the release of their new updated phone as a means to maximize profit. By withholding the release of the phone, not only does demand build but the ability of more consumers to enter into the market to purchase the phone does occur. At this point, the profit maximization curve peaks earlier and is likely to have a prolonged parabola at the top of the curve which is a short-term profit maximization curve.
With a low employment rate, the likelihood of the smart phone market to do very well is limited by the low employment rate and is subject to constraints when considering the smart phone market and the consumer's ability to pay.
Supply & Demand
Law of demand and substitutes how the demand of these phones are very high. Which again ties back to scarcity but how substitutes are so readily…
The Economist. Science and technology. Babbage Mobile phones. Good night phone. May 30th 2011, 19:33 by G.F. | SEATTLE
Economic Depression of Europe
An economic depression is more severe than a recession due to the fact that a depression involves drastic decline in a national or international economy, characterized by decreasing business activity, falling prices, and high levels of unemployment.
There were economic depressions in Europe that were experienced before and after the 1870 but with a remarkable difference, being that those that were experienced before the 1870s were less costly in terms of life and resources and took relatively lesser period. Indeed it was a commonplace that every part of Europe experienced one sort of economic depression or the other.
One such economic situation before 1870 was the "little ice age" which began in the late 16th century till around 1950s as indicated by Big Site of History (2011). This was a time when a severe cold that could not be withstood by most crops set in most…
Big Site of History (2011). Social Trends in 17th Century Europe: The Problem of Divine-Right
Monarchy. Retrieved July 18, 2011 from http://bigsiteofhistory.com/social-trends-in-17th-century-europe-the-problem-of-divine-right-monarchy
Historic UK, (2011). The Great Plague 1665. Retrieved July 18, 2011 from http://www.historic-
hile the U.S. is only showing the first signs of recovery from the global economic crisis, other nations such as Australia and China have recovered much more quickly. There are a number of factors that have contributed to the disparity in economic performance in the past three years in these different nations. In particular, three factors will be considered. The first is the situation in each country at the outset of the crisis. As the crisis was largely precipitated by a credit crunch, the differences between the structure and regulation of the banking sectors in each country will be given particular attention. The second factor will be the response on the part of each federal government to the crisis. The third factor will be the nature of the different economies -- the degree to which different structures have impacted the recovery process. Lastly, policy implications will be drawn for…
BEA. (2011). National income and product accounts table. Bureau of Economic Analysis. Retrieved March 4, 2011 from http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=1&ViewSeries=NO&Java=no&Request3Place=N&3Place=N&FromView=YES&Freq=Year&FirstYear=2007&LastYear=2010&3Place=N&Update=Update&JavaBox=no#Mid
Chinability.com. (2010). GDP growth in China 1952-2009. Chinability.com. Retrieved March 4, 2011 from http://www.chinability.com/GDP.htm
Jones, F. (2011). Krugman: Stimulus didn't fail because it never happened. Moneynews.com. Retrieved March 4, 2011 from http://www.moneynews.com/StreetTalk/paul-Krugman-Stimulus-Didnt/2011/02/16/id/386333
Maiden, M. (2009). Australia's banking sector is as strong as a brick outhouse. The Age. Retrieved March 4, 2011 from http://www.theage.com.au/business/australias-banking-sector-is-as-strong-as-a-brick-outhouse-20090506-avdj.html
Economics impacts on many areas of life subsequently it will impact on many areas of professional life. eflecting on the lessons learned, including the knowledge and skills gained, the real value is in the way that economics concepts can be applied to the real world; not only to explain event that are seen in the macro-environment, but to guide the way personal decisions will be made with that knowledge.
The first indicator of the lessons and concepts taught in the class being absorbed and developing into transferable knowledge has emerged with an increased understanding of the way that the economy operates and the influences which are present in the economy that are driving up prices.
There are many examples of the economic concepts; one example is the way that supply and demand has impacted on oil prices which has had a knock on effect in the economy as…
Baye Michael, (2007), Managerial Economics and Business Strategy, McGraw-Hill/Irwin
Greimel, Hans, (2012. April 30), Toyota wants high-volume U.S. Prius output by '15; Hunt is on for N.A. hybrid parts suppliers, Automotive News, p4
Nellis JG, Parker D, (2006), Principles of the Business Economics, London, Prentice Hall.
Scholes, Louise; Siegel Donald S; Wilson, Nick; Wright, Mike, (2012, Feb), Private equity portfolio company performance during the global recession, Journal of Corporate Finance, 18(1), 193.
Economics of International Trade China
Exploring the Economics of International Trade: China
"Chinese international trade has experienced rapid expansion together with its dramatic economic growth which has made the country to target the world as its market," and its expansion has only continued to show powerful growth within the international economic marketplace (Sun & Heshmati, 2010, p 1). After China was reopened to trading with the West in 1978, the country has really took off in becoming one of the world's biggest producers and exporters of a plethora of different goods. China has grown tremendously as nations like the United States have become their biggest trading partners. In response, China has helped refuel this growth with the manipulation of their currency and their heavy investment in the U.S. dollar, which ensures them a more competitive position for their exports.
For generations, China had closed itself off to trading and interacting…
American Manufacturing. (2012). China and currency manipulation. Issues. Web. Retrieved September 4, 2012 from http://americanmanufacturing.org/category/issues/china/china-and-currency-manipulation
Barboza, David. (2012). Business and economy in China. New York Times. Web. Retrieved September 4, 2012 from http://topics.nytimes.com/topics/news/international/countriesandterritories/china/business_and_economy/index.html
Congress Quarterly. (1999). The consumer culture. CQ Researcher, 9(44), 1001-1016.
Manzay, Terrance. (2010). China export industry dominates worldwide. Article Snatch. Web. Reprieved September 4, 2012 from http://www.articlesnatch.com/Article/China-Export-Industry-Dominates-Worldwide/3853472#.UEZqYKNIuHY
An analysis of the latest figures for key economic indicators and the factors which have affected these indicators. This should include the figures for unemployment, inflation and economic growth.
The unemployment rate is a very important indicator of the overall health of the economy. Currently the unemployment rate is at 7.8% (Office for National Statistics, 2012). However, this figure does not affect the population equally. Different segments of the population have different employment rates. Furthermore, the unemployment rate does not include people that are not actively seeking employment. In the chart these people are considered to be "inactive." Another interesting item listed in the report is that the unemployment rate for the youth demographic was falling due to a record number of 16 to 24-year-olds being enrolled in some type of educational program.
Employment in the UK has suffered from recession. In 2008 there was a…
Financial Times, 2013. Question 3: Fiscal Policy. [Online]
Available at: http://www.ft.com/cms/s/0/1115c770-545a-11e2-9d25-00144feab49a.html#axzz2IAShLpER
[Accessed 1 January 2013].
Kirka, D., 2011. UK recession fears grow as manufacturing drops. [Online]
00). This is below the EU, where they have a rating of 42 or a PPP of $32,500.00. (Czech epublic 2010) 1 When you compare the two numbers, the purchasing power is lower in the Czech epublic in comparison with the EU. This means, that labor costs are much lower in relation to the rest of Europe. When you put this together with the increases in the GDP over the last two quarters and the fact that the banking sector, was undamaged from the financial crisis; means the Czech epublic has outstanding opportunities for addressing the needs of the company. As the country's costs, the business friendly atmosphere and prudent practices of government policies are creating the ideal environment for a European call center to flourish.
Despite the obvious advantages, there are risks of relocating to the Czech epublic the most notable would include: the underlying cost structure. While…
1. Czech Republic, 2010, CIA World Factbooks. Available from
However, Bernanke remains unwilling to use his power to lift economic growth and reduce unemployment. One reason for not wanting to take active steps to speeding up the U.S. economic growth is a worry that the financial markets are fragile. So, it seems that the Federal Reserve are simply willing to accept high unemployment rates for years to come, instead of risking a perhaps worse situation of market panic, a rise in long-term interest rates, and even higher unemployment.
) Mulligan, Casey B. "Don't Fear Inflation, if it Comes," 2 June 2010. http://economix.blogs.nytimes.com/2010/06/2/dont-blame-the-next-inflation-on-politicians/?ref=economy
Inflation occurs when the demand for goods increases more than the demand for dollars and other related assets. Economists have no doubt that the significant deflation that occurred in the U.S. In 2008-2009 was the result of a "flight to quality," as opposed to a sudden reduction in the demand for goods and increase in demand for…
3) Mulligan, Casey B. "Don't Fear Inflation, if it Comes," 23 June 2010. http://economix.blogs.nytimes.com/2010/06/23/dont-blame-the-next-inflation-on-politicians/?ref=economy
Inflation occurs when the demand for goods increases more than the demand for dollars and other related assets. Economists have no doubt that the significant deflation that occurred in the U.S. In 2008-2009 was the result of a "flight to quality," as opposed to a sudden reduction in the demand for goods and increase in demand for dollars. However, economists agree that inflation will occur in the future if the demand suddenly shifts in the opposite direction. but, that is where the current debate lies. Some economists say that investors over the next years will continue to demand dollars, so future deflation is more likely. On the other hand, some economists predict that the government budget is unable to be sustained as is, given the multitude of promised public spending and a lack of desire or power to raise taxes. Overall, one can conclude that inflation has the potential to be a positive thing to hope for, seeing that it might be able to help alleviate some of the damage done by the housing market to wider areas of the economy (raising prices of homes and other articles).
4) Hook, Janet. "Big issues remain in financial
Meanwhile, Dwight R. Lee (writing in The Independent Review, 2001) points to a situation where a powerful environmental group (Audubon Society) has cooperated with an energy company and both have profited. Free market environmentalism has shown the way for profits and preservation at the same time in this case. The Audubon Society (AS) owns the 26,000-acre Rainey Sanctuary in the swamps of Louisiana, and while the group is opposed to oil drilling and gas drilling in 99 out of 100 cases, the AS has "been willing to accommodate the interests of those whose priorities are different" (Lee, p. 219). Those interests include allowing thirty-seven wells to be exploited for oil and gas in the Rainey Sanctuary.
According to Lee, the AS has received royalties of more than $25 million from those 37 wells, and in the meantime the technology used in the oil and gas development has prevented any spills…
Anderson, Terry L., and Leal, Donald R. Free Market Environmentalism. New York: Palgrave
Lee, Dwight R. "To Drill or Not to Drill: Let the Environmentalists Decide." The Independent
Review, VI.2 (2001): 217-226.
Two alternative solutions are available. The first sees that the U.S. federal authority uses the budget allocated to support the development of the national industries, without raising barriers to imports. The second possible solution is for the United States to strive to increase its exports by focusing more on international operations.
Criteria / goals
The evaluation criteria for the proposed solutions revolve around the benefits they generate, as well as the costs they imply. Otherwise put, the decision will be made in accordance with the arguments in favour and against each of the two alternatives, and by the solution's ability to meet the established goals. These goals include the insurance of economic stability within the United States (for all population, corporations and the entire system), the maintenance or even development of international relations, as well as the sustained development of the domestic industries.
Evaluation of alternatives
January 29, 2009, Buying American, the Economist, last accessed on February 5, 2009
Steps in the P.A.C.E.D. Model, the Gus a. Stavros Center for Free Enterprise and Economic Education
http://stavros.coedu.usf.edu/EconomicLiteracy/sld019.html. Ast accessed on February 5, 2009
Economic crash can be viewed from a number of perspectives ranging from causes and effects to the 2008 Crash's resemblance to the Crash of 1929, which began the Great Depression. This paper will consider the 2008 recession from the standpoint of the financial banking industry, which, according to economic journalists like Matt Taibbi (2010), played a major and significant role in the crumbling of the nation's economy -- just like it did in the Lawless Decade also known as the oaring Twenties.
Big Banking Meets Big Government
What has now become known as the Era of De-egulation actually had its beginnings in the 80s decade known just as much for its rampant excess as the early 20s were known for their unbridled lawlessness. Yet, while the latter enjoyed the snubs-to-the-law bootlegging speakeasies, the former enjoyed the merging of the financial sector with the political -- which began during eagan's tenure…
AP/HuffPost. (2011). Charles Ferguson's Oscar Speech Rips Wall Street: 'Inside Job'
Director Levels Criticism During Acceptance. HuffPost Business. Retrieved from http://www.huffingtonpost.com/2011/02/28/charles-ferguson-oscar-speech-inside-job_n_828963.html
Sann, P. (n.d.). The Lawless Decade: A Pictorial History of the Roaring Twenties.
Retrieved from http://lawlessdecade.net/
The nation will enforce law and order to protect its public property, regulate monetary frameworks and correct market failures. The government will be responsible for protecting private life of its citizens and property (Grant & Vidler, 2000).
Market and Competition Forces: the country's economy should be designed in such a way that it will promote competition. This is because competition means a fair deal in obtaining results. The government should increase sellers and buyers in the market because this would promote competition thus increasing the quality and efficiency. With competition, the country will be able to control and manage different functions of its economy (Grant & Vidler, 2000). Demand and supply are the prime market forces determining the production of a country produces and the suitable ways to do so.
Market equilibrium, price and output, are determined by market forces. Therefore, I would recommend that any least developed nation to…
Bahl, Roy, W. (2008). Land taxes vs. property taxes in developing countries. Cambridge,
MA: Lincoln Institute of Land Policy.
Grant, S. & Vidler, C. (2000). Economics in Context. New York: Heinemann.
Hyman, D.N. (2011). Public finance: A contemporary application of theory to policy (10th ed.).
Economic Value Added (EVA) Accounting Practice
Although Economic Value Added (EVA) is not a new concept in economics and financial theory and is based on the 19th century concept of "economic profit," it has only been widely adopted recently by business firms as an accounting practice. In this paper we shall describe what EVA is, and look at its pros and cons from the point-of-view of the company adopting the practice and the investors. We shall also discuss how EVA differs from some other emerging accounting practices and the major issues relating to EVA as compared to other commonly used accounting principles. Finally, the possible problems and opportunities that a company adopting EVA principles can face shall be examined.
What is Economic Value Added (EVA)?
Economic Value Added (EVA) is the after-tax cash flow generated by a business minus the cost of the capital it has invested to generate that…
Keen, Peter. (1999). "Economic Value Added.(EVA)" Every Manager's Guide to Business Processes. Retrieved on April 20, 2003 at http://www.peterkeen.com/emgbp007.htm kel inen, Esa. (1998). "Economic Value Added as a Management Tool." Retrieved on April 20, 2003 at http://www.evanomics.com/
Shand, Dawne. (October 30, 2000). "Economic Value Added." COMPUTERWORLD. Retrieved on April 20, 2003 at http://www.computerworld.com/managementtopics/management/itspending/story/0,10801,53001,00.html
Stewart, Bennet (1999) "What is EVA?" Stern Stewart & Co. Web site. Retrieved on April 20, 2003 at http://www.sternstewart.com/evaabout/whatis.php
This cost reflects both the time value of money and compensation for risk -- the more risk associated with a firm, the greater the firm's cost of capital.
Sorkin's book does a good job of giving the details on what happened among Lehman Brothers, Barclays, JP Morgan, Goldman Sachs, the Fed, and Big Gov following the collapse. Essentially, everyone had egg on his face -- but some of the bigger powers had the muscle to save face -- and sink competitors at the same time: which is exactly what Goldman Sachs did to Lehman. Goldman had been placing its cronies in the hite House for years -- and it would now go through the hite House to see who got bailed out and who did not. AIG got one -- because it owed a large chunk to Goldman (who had figured out the game ahead of time and started betting against itself by buying insurance through AIG). Sorkin's work is a work full of the kind of details that other writer's like Taibbi and Lewis do not take…
Lewis, Michael M. The Big Short: Inside the Doomsday Machine. New York, NY: W.
W. Norton & Company, 2010. Print.
Sorkin, Andrew. Too Big to Fail: the inside story of how Wall Street and Washington
fought save the financial system -- and themselves. New York, NY: Penguin, 2010. Print.
A price discrimination strategy is one where different customers are charged different amounts. The price charged for my shop's submarine sandwiches will therefore be different for locals than for visitors. There are a number of ways to achieve this. In the context of a sandwich shop, the prices are going to be listed publicly on the menu, so it is impossible to openly discriminate with respect to prices. One technique that can be utilized to lower the average cost for each sub-for locals is to offer a loyalty card. The local would then receive either a discount or a free sub-after making enough purchases. This would deliver a lower price to locals in the long run. Alternately, a loyalty club can allow the locals to receive discounts if they are members of the club. A certain amount of annual sales would be required for club membership, or even a…
Investopedia. (2010). Perfect competition. Investopedia. Retrieved October 16, 2010 from http://www.investopedia.com/terms/p/perfectcompetition.asp
ACC. (2010). U.S. antitrust agencies issue revised merger guidelines. Association of Corporate Counsel. Retrieved October 16, 2010 from http://www.lexology.com/library/detail.aspx?g=cf23ba87-0ed6-4db5-9739-d7cf74bcdf8f
e. no standardization) b) Diamonds: good medium of exchange
Peaches: perishable, differences in quality (i.e. no standardization) d) Grade a Honey: differences in quality (i.e. no standardization), difficult to transport e) Ice in a warm climate: perishable, difficult to store a. Over the long run, what is the primary determinant of the price level? Supply and demand, with price acting as an equilibrator b. Over the long run, what is the primary determinant of inflation?
The supply of money as compared to changes in productivity.
c. How is inflation related to the nominal interest rate?
Expectations of future inflation are one of the key factors in determining the nominal interest rate, the other being the 'core' interest rate, or the inflation-free level at which one is willing to lend money (which differs according to the issuer and associated risk premium).
4. Describe each of the following financial institutions. If it…
Increases in manufacturing reveal benefits early, one can track the benefit at all stages and report the benefits to the public quickly. According to a statement released by the Center for American Progress, "solar panels don't install themselves. Wind turbines don't manufacture themselves. Homes and buildings don't retrofit or weatherize themselves. In our industrial society, trees don't even PLANT themselves, anymore. eal people must do all of that work." The public wants a quick fix, they want to start hearing that the economy is doing better and a focus on manufacturing will accomplish this. Additionally, there has been increasing pressure on the White House to focuses on alternative energy sources. Such a policy would gain favor with democratic and liberal environmentalists.
4. Do you consider your views to be more aligned with a classical or Keynesian approach to economic thinking? Explain. (There is no right or wrong answer). See module…
Chea S., (2010). "Manufacturers' Orders as an Economic Indicator." Associated Content February, 2010. Retrieved from http://www.associatedcontent.com/article/2685879/manufacturers_orders_as_an_economic_pg2.html?cat=3 .
Federal Reserve bank of New York. Durable Goods. Retrieved from http://www.newyorkfed.org/education/bythe.html#durgoods .
Hoexter, M., (2009). "Cap and Trade: An Unserious Policy Framework.. Towards a Serious Climate Policy -- Part 2."Climate Policy, Energy Policy, Sustainable Thinking, December 2009.
Podesta, J., Stern T., (2007). "Capturing the Energy Opportunity: Creating a Low-Carbon Economy." The Center for American Progress, Nov. 2007. Retrieved http://www.americanprogress.org .
As Taibbi shows, it is not easy: "I'm going to say something radical about the Tea Partiers. They're not all crazy. They're not even always wrong. hat they are, and they don't realize it, is an anachronism. They're fighting a 1960s battle in a world run by twenty-first-century crooks" (Griftopia 16-17). Taibbi makes clear that the Tea Party is not even homogenous: it is made up of a broad spectrum of individuals (some of whom do not even want to be called Tea Partiers) who are angry and looking for someway to focus their anger.
In conclusion, recouping the losses is not an easy thing to do. hen a company like Lehman Brothers can be allowed to collapse while their competition (Goldman Sachs) can be bailed out by tax payer dollars, citizens are going to start wondering how their country got to such a point in the first place. Taibbi…
AP/HuffPost. Charles Ferguson's Oscar Speech Rips Wall Street: 'Inside Job' Director
Levels Criticism During Acceptance. HuffPost Business. Web. 8 Apr 2011.
Campbell, Andrea Louise. "Is the Economic Crisis Driving Wedges Between Young and Old? Rich and Poor?" Generations 33.3, Fall 2009: 47-53. Print.
Espo, David. "Deadline nears: Shutdown looms without agreement." Yahoo! News, 8
The U.S. is a property owning civilization and a number of the people wanted land and housing. Americans however scarcely ever create savings. "The country itself lives on other countries' savings by issuing bonds to finance its excessive consumption. The current crisis began with cheap housing loans offered by banks. Banks provided loans but instead of holding the loan in their books, they packaged them into collateralized debt obligations (CDOs) and sold them to other agencies. These agencies passed them on to others and spread them globally as assets" (the Current Economic Crisis, its causes, its impact and possible alternatives, 2009).
Interest rates were lowered and housing loans went up with construction activities leading to land prices increasing. The real estate was booming, generating employment and incomes. But as the rate of interest on housing loans came down, banks started to compete to get more business. Because of low interest…
Avizius, R. 2009. Financial Crisis Big Picture: What has the Government Response Been? [ONLINE] Available at: http://www.marketoracle.co.uk/Article9229.html . [Accessed 22 May 2012].
Centeno, M.A. & Cohen, J.N. 2012. The Arc of Neoliberalism. [ONLINE] Available at: http://www.yale.edu/macmillan/transitionstomodernity/papers/CentenoCohen.pdf . [Accessed 22 May 2012].
Crotty, J. 2009. Structural causes of the global financial crisis: a critical assessment of the 'new financial architecture' . [ONLINE] Available at: http://cje.oxfordjournals.org/content/33/4/563.full . [Accessed 22 May 2012].
Esteva, G. (n.d.). The Meaning of the Global Crisis and "Recovery" for Study Abroad: What are we Preparing Students for? [ONLINE] Available at: http://digitalcollections.sit.edu/cgi/viewcontent.cgi?article=1110&context=faculty_symposium . [Accessed 22 May 2012].
The recession of 2008-2009 and the subsequent government responses provides a good test for economic theories. There are no controlled experiments in economics, so we can only work with case studies in order to understand how economies work. A good starting point is to consider the issue through multiple different lenses, so that we can understand how the crisis occurred and what prescriptions might be best suited for response either to address the root problems or to engage in prevention. This paper will consider the works of Marx, Schumpeter and Keynes in analyzing the financial crisis. All three of these men would have been able to understand its causes, but likely would have taken very different approaches to solving the problem.
The second issue at hand is the question of the future of capitalism. We have a pretty good sense at this point of what the response of…
Cox, W. & Alm, R. (2013). Creative destruction. Library of Economics and Liberty. Retrieved December 7, 2013 from http://www.econlib.org/library/Enc/CreativeDestruction.html
Eichengreen, B. (2010). The crisis of financial innovation. University of California at Berkeley. Retrieved December 7, 2013 from http://emlab.berkeley.edu/~eichengr/crisis_finan_innov.pdf
Isfeld, G. (2012). Canada's banks shake off global sector crisis. Financial Post. Retrieved December 7, 2013 from http://business.financialpost.com/2012/10/10/canadas-banks-shake-off-global-sector-crisis/
Liu, H. (2008). Too big to fail moral hazard. Asia Times. Retrieved December 7, 2013 from http://www.atimes.com/atimes/Global_Economy/JI23Dj12.html
Economic Change in Saskatchewan
"If there were a change in Saskatchewan's economic circumstances from one of "boom" to one of "normal" or "bust," which current areas of government activity would you expect to be affected by this change, and, what would you expect the government's policy response to be to adapt to these new economic conditions?"
Currently, Saskatchewan was seen significant and rapid development in economic activity. The province has been able to take advantage of the rich supply of natural resources and exports many commodities to global markets. Much of the growth that the area has experienced can be attributed to the growth of potash and oil. However, these resources may not sustain the levels of economic growth that the region has experienced indefinitely. If Saskatchewan does not work to diversify its economy then the economic boom that it has experienced could slowly dwindle away. Furthermore, if…
Craig, M. (2014, April 9). Challenges ahead to sustain Saskatchewan's rate of economic growth. Retrieved from Global News: http://globalnews.ca/news/1261615/sustaining-our-economic-growth/
Government of Saskatchewan. (N.d.). Economy. Retrieved from Government of Saskatchewan: http://www.gov.sk.ca/Default.aspx?DN=8f48fa79-d320-48d8-bc6a-f414d4c59694
Government of Saskatchewan. (N.d.). The Saskatchewan Plan for Growth. Retrieved from Government of Saskatchewan: http://www.saskatchewan.ca/government/budget-planning-and-reporting/plan-for-growth
The Institute of Certified Management Consultants of Saskatchewan. (N.d.). The Role of Urban Communities in Sustaining. Retrieved from CMC: http://www.cmc-canada.ca/documents/thinkbigsk/CMCSK-EconomicReview-April2014.pdf
Ergo, the role of the EU seems to be that of implementing protectionist policies. These would be developed onto three simultaneous directions.
A first set of policies would revolve around the creation of a new market architecture at the EU level. This would strengthen the EU's position in the face of future challenges by:
ensuring a sustained and strong support from central banks allowing banks to rapidly implement the rescue plans, and allowing the Union to rapidly implement decisive methods that would prevent the expansion of the crisis to other countries (Commission of the European Communities, 2008).
A second set of strategies revolves around the necessity to really analyze the impacts the crisis has had upon the real economy and find ways in which to improve the real economy. These policies would combine short-term solutions to issues in need of rapid response as well as long-term projects. The short-term solutions…
Budowsky, B., January 22, 2008, the Economic Crisis, the Hill
Kilmister, a., December 2008, the Economic Crisis and Its Effects, World Economy, No. 407
Miller, J., Jackson, B., Who Cause the Economic Crisis? The Annenberg Public Policy Center of the University of Pennsylvania
http://www.factcheck.org/elections-2008/who_caused_the_economic_crisis.html , last accessed on January 7, 2009
Economics for Business
The company that I am studying is Apple. The company is a designer and marketer of consumer electronics, specifically computers, smartphones, tablets, mp3 players and software. The company has experienced a strong run of great performance in recent years, but it has not always been that way for Apple. The company struggled considerably, especially in the 1990s, before breaking loose. The key thing about Apple is that it has always sought to differentiate itself. Over the course of the past ten years, we have seen most of Apple's former competitors in the personal computer space leave the industry. The reason is that the computer industry is moving towards the strategic hell of perfect competition.
The term strategic hell reflects the condition of perfect competition. In the real world outside of economics textbooks, few markets can be truly understood to be perfectly competitive. Perhaps a vegetable…
Lunden, I. (2013). Android at 82% share, Samsung a flat leader. TechCrunch.. Retrieved November 25, 2013 from http://techcrunch.com/2013/11/14/gartner-456m-phones-sold-in-q3-55-smartphone-android-at-82-share-samsung-a-flat-leader/
Mourdoukoutas, P. (2013). Apple's most important branding lessons for marketers. Forbes Retrieved November 21, 2013 from http://www.forbes.com/sites/panosmourdoukoutas/2013/10/05/apples-most-important-branding-lesson-for-marketers/
MSN Moneycentral. (2013). Apple Inc. MSN Moneycentral. Retrieved November 22, 2013 from http://investing.money.msn.com/investments/stock-income-statement/?symbol=AAPL
Riley, G. (2013). Strategic choice: Apple: Differentiation v scale. Tutor2U.net. Retrieved November 21, 2013 from http://www.tutor2u.net/blog/index.php/business-studies/comments/strategic-choice-apple-differentiation-v-scale
Economics - Country Analysis
Country Overview and Current Events (News)
Ethiopia, traditionally known as Abyssinia, is a landlocked Sub-Saharan country located at the Horn of Africa in East Africa, bordering Somalia, Kenya, Eritrea, Djibouti, Sudan, and the newly-created South Sudan. It covers approximately 1,126,829km2 of land; about the size of the state of Texas, and was, until the split of Sudan, the second-largest country in Africa. Being landlocked, Ethiopia largely relies on the port of Djibouti, to which it is connected by both rail and road. Economic elements such as this, together with the country's history, population, geography and economic performance have been explored in the subsequent sections of this text.
Population: the U.S. Census Bureau, in June 2013, estimated Ethiopia's population to be 93,877,025; a figure that makes the country the second-most populous in Africa, after Nigeria (orld Bank, Index Mundi). Ethiopia's population has been on a steady increase…
AFDB. "Inflation Dynamics in Selected East African Countries: Ethiopia, Kenya, Tanzania and Uganda." AFDB Brief, 2012. Web. 18 March 2014 http://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/07022012Inflatin%20East%20Africa%20-%20ENG%20-%20Internal.pdf
This article analyses the trend in Ethiopia's inflation rates vis-a-vis those of other countries in the Sub-Saharan region and was a valuable source of regional statistics, which formed the main basis for comparison.
Broussar, Nzinga, and Tekleselassie Tsegay. "Youth Unemployment: Ethiopia; Country Study." International Growth Center, 2012. Web. 18 March 2014 http://www.afdb.org/fileadmin/uploads/afdb/Documents/Publications/07022012Inflation%20East%20Africa%20-%20ENG%20-%20Internal.pdf
This article analyzes the trend in Ethiopia's employment patterns. It reinforced my arguments that unemployment is more prevalent in urban Ethiopia, and that the country's informal sector contributes more to GDP than the formal sector.