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Growth Models
Words: 906 Length: 3 Pages Document Type: Research Paper Paper #: 51840122
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GDP GNI

GDP and GNI Discussion: China and Canada

The country selected for our analysis is China, a nation that has experienced an apparent increase in the rate of its growth in concurrence with the shifts in the global economy. s free trade has opened China up to a greater number of trade partners and to particular trade partners in much larger proportion such as the United States, a great many indicators stand to suggest that China has in fact enjoyed a change in its rate of growth. On the surface, this appears to correspond with the principles of the Harrod-Domar model, which indicates that "the more an economy is able to save -- and invest -- the great will be the GDP growth." (Ghosh, lec3-4.1, p. 11)

s China's role in the global economy has increased, its apparent savings and capital for investment has produced a non-constant growth rate…

As noted above, the actual GDP (annual %) in China rose between the years of 2001 and 2005 steadily and to the end of a 3% point increase. This is a point of reference for the developing nation as compares to the relatively industrialized and fully globalized Canada. According to the World Bank, Canada's actual GDP rates during this period were 1.8, 2.9, 1.9, 3.1 and 3.0. We note several distinctive differences immediately between these indicators and the index produced in China during the exact same period.

Before considering these differences in greater detail, we consider the divergent starting points of the two nations in consideration. According to the World Bank, the GNI per capita, PPP (current international $) may help to underscore the two distinct trends. In China, this number is presented according to world currency standards as $2,948,848,362,904.5 whereas in Canada, this index produces the figure of $851,322,906,082.9. Both figures are drawn from the year 2000 and precede the differing rates of growth between the two nations. Here, we are in the unusual scenario of examining a developing nation whose GNI is significantly higher than that of the developed nation considered. The Solow model helps to bring clarity to this discussion by revealing that with the addition of labour to the equation examining per capita growth, we can understand with greater accuracy the GDP growth there experienced. The enormity of China's economy is driven by this principle, with the Solow model offering the equation of k=K/L as a way of deteriming where K. is technology and L. is labour and where both produce diminishing returns alone but constant returns when combined. (Ghosh, lec3-4.2, p. 33)

Here we gain some explanation for China's greater potential for short-term growth, with its greater labour pool and the more novel infusion of global technology opportunities helping to stimulate a greater and more constant rate of growth for the massive developing nation. To this point, across the years of 2001 and 2005, the average rate of growth for Canada is .24%. For China, the average rate of growth is .6%. Given the relationship between labour and technology and all that we have learned about China's dramatic gains in these areas across the last decade, it is as anticipated that its growth has been faster, greater and of a more constant nature than that seen in Canada. This confirms the initial assumptions of the Solow model, illustrating that when external forces such as the influx of new technologies combine with an already expansive labour force, the opportunity for a more sustained type of growth becomes probable.

Economy Moves in Cycles There
Words: 870 Length: 3 Pages Document Type: Term Paper Paper #: 33150958
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The unemployment rate for January 2013 was 7.9%, in December it was 7.8%, this appears to be a deterioration; however, it is usual for unemployment to increase in January as seasonal jobs disappear. Looking at the rate in January 2012 it was 8.3% and in January 2010 it was 9.1%, therefore unemployment rates are decreasing slowly (BLS, 2013). The consumer prices index also shows an increase; in 2012 it rose by 1.6%. Overall, there is an improvement, from a time that has been defined as a recession, the growth is slow and constrained, but expected to improve further, therefore the current economic stage is that of a recovery, or early recovery.

Question 2

The traditional method of assessing the economic growth is by measuring the GDP, with the underlying assumption that where there is growth in the GDP there will be an increase in welfare, with the measure usually being…

U S Macro Economy Which Was Considered to
Words: 1238 Length: 4 Pages Document Type: Essay Paper #: 97755054
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U.S. Macro economy

economy which was considered to be the world's largest has still not been able to recover completely from the financial crisis and resulting recession that hit in 2008. At the national level, spending increase to more than 25% of GDP in 2010, later in 2011 gross public debt exceeded 100% of GDP. The process of recovery for U.S. economy in the first quarter turned out to be weaker than expected. From January through March, the gross domestic product (GDP) of the nation grew at a 1.8% annual rate. The economy of U.S. has grown for 15 consecutive quarters; however the pace of those gains was about 2% which was actually in the weakest recoveries since World War II. U.S. economy is being held back by its tightening fiscal policy. In this year, the spending cuts are estimated to be $85 billion and expected to grow to $109…

References

Danielson, A. (1994). The economic surplus. Westport, Conn.: Praeger.

McCarty, Nolan, Keith T. Poole, and Howard Rosenthal (2006). Polarized America: The Dance of Ideology and Unequal Riches. Cambridge, MA: The MIT Press.

Moffatt, M. (1965).The Economic Effect of Tariffs. [online] Retrieved from:  http://economics.about.com/cs/taxpolicy/a/tariffs_3.htm  [Accessed: 28 Jun 2013].

Ormerod, Paul. (2010). The Current Crisis and the Culpability of Macroeconomic Theory. Twenty-First Century Society.

Foreign Health Care Policy
Words: 975 Length: 4 Pages Document Type: Research Paper Paper #: 27598287
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Foreign Health Care Policy

Over the last several years, issues affecting the U.S. health care system have been increasingly brought to the forefront. This is because rising costs are impacting demand for different services. What has been happening is these increases are forcing insurance companies, employers and providers to pass on more of these fees to the individual. This is problematic, as they are unable to afford these costs and premiums for coverage. When this happens, the total number of people who are uninsured will increase exponentially. Evidence of this can be seen with the fact that there are 48 million Americans who have no form of health care coverage. (Johnson, 2010) (Harrington, 2009)

While in Germany, the costs of care are lower and 90% of the population is insured. This is because they are using a different model. To fully understand which system is better requires comparing the two…

References

Armstrong, E. (2011). The Health Care Dilemma. Singapore: World Scientific.

Greenwald, H. (2010). Health Care in the United States. San Francisco, CA: Jossey Bass.

Harrington, C. (2009). Health Policy. Sudbury, MA: Jones and Bartlett.

Johnson, J. (2010). Comparative Health Systems. Sudbury, MA: Jones and Bartlett.

Impact of GPD
Words: 314 Length: 1 Pages Document Type: Term Paper Paper #: 1878519
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GDP forecast for the next 18 months is bound to have an impact on the industrial figures in general and, in particular, on the automobile industry, in terms of production and revenues.

First of all, a GDP forecast will influence the foreign investments in the United States. The reason for this is quite simple and it revolves around the confidence concept. A positive GDP forecast will mean that the American economy is presently performing well and, even more important, that it will continue to perform well into the future as well, with an ascending GDP trend.

For a foreign investor, this will mean that acquiring American assets is a less risky and more profitable action than in a different situation. The fact that you have a positive forecast for the next 18 months is bound to show that the economy is producing, that the figures are satisfactory and that you…

DQ 1 An Economy's Output Is Also
Words: 353 Length: 1 Pages Document Type: Term Paper Paper #: 19819573
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DQ #1. An economy's output is also its income because its output is calculated as the measurement of all the goods and services produced by the economy, and also being channeled back into the economy in the form of purchases in other economic sectors, savings, and investments. Expenditures measured in the form of GDP tally the production of goods and services on U.S. soil while GNP measures the production of goods and services produced anywhere by the U.S. residents. Both can generate income for U.S. companies and consumers that can be funneled back into the economy in exchange for other durable and nondurable goods, and services, as well as reinvested into other sectors. However, imported goods are subtracted out of the calculation of a national income, because the funds generated by the foreign production companies will be funneled back to the base, foreign nation. U.S. consumers may buy foreign goods,…

Economic Outlook Take Another Look
Words: 830 Length: 2 Pages Document Type: Essay Paper #: 79774223
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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…

REFERENCE LIST

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 .

Jamaica and United States An Analysis of
Words: 926 Length: 2 Pages Document Type: Essay Paper #: 38629203
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Jamaica and United States: An Analysis of GDP

Comparison of Jamaica and U.S. GDP

In 2009 U.S. dollars Jamaica's Gross Domestic Product (GDP) based on purchasing power parity registered at 23.76 billion (CIA Factbook- Jamaica). In contrast the United States of America produced a Gross Domestic Product of 14.12 trillion dollars in 2009 dollars (CIA Factbook- U.S.). espectively these figures translate to a per capita GDP of $8,400.00 dollars for Jamaica (CIA Factbook- Jamaica) and $46,000.00 for the United States (CIA Factbook- U.S.). Given the distinct disparities in GDP, an analysis of the components comprising the GDP calculation provides useful insight into the similarities and differences inherent in the two nations.

GDP is comprised of four components: consumption expenditures, investment expenditures, government purchases, and net exports. Taken in aggregate these components detail "the market value of all final goods and services produced within a country in a given period of…

References

CIA.gov. CIA Factbook: Jamaica. (November 17, 2010). Retrieved December 02, 2010 from  

Country Economic Analysis Report When
Words: 890 Length: 3 Pages Document Type: Essay Paper #: 68162099
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1% and agriculture 6.0%. ("Jamaica," 2010) The U.S. is more heavily focused on services, with this accounting for 76.9% of the GDP. This is followed by: industry (coming in at 21.9%) and agriculture (accounting for 1.2%). ("United States," 2010)

Labor Force

The labor force of Jamaica is currently 1.311 million people. ("Jamaica," 2010) While the labor force of the United States is 154.2 million. ("United States," 2010)

Labor Force by Occupation

The labor force by occupation for Jamaica would include: 64% working in services, 19% in industry and 17% in agriculture. ("Jamaica," 2010) In the U.S. The labor force is divided differently with: 37% working in managerial / professional positions, 24.2% in sales / services, 20.3% in manufacturing, 17.6% in other services and .7% in farming. ("United States," 2010)

Population below the Poverty Line

The total population that is living below the poverty line in Jamaica is: 14.8%. ("Jamaica," 2010)…

Bibliography

Country Comparison GDP Purchasing Power Parity. (2010). CIA World Fact Book. Retrieved from:  

Markets & Economy a Budget
Words: 1172 Length: 4 Pages Document Type: Essay Paper #: 19369386
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Rational firms will choose the lowest-cost option between the two. The market is expected to be efficient, so that while some firms will find it cheaper to pollute, other firms will find it cheaper to install pollution abatement mechanisms.

Ultimately, the system will seek to deliver the lowest per-unit cost of abatement. This will be achieved because the firms that are going to abate their pollution are the ones for whom the cost of abatement is lower than the cost of polluting. With these firms focused on their abatement efforts, they will deliver a greater degree of pollution abatement at a lower per-unit cost with the marketable permits than any other system.

To see the value in this system, the alternative must be considered. If firms are mandated to reduce pollution, they will do so to bring themselves under the maximum allowable pollution levels. However, firms will have no economic…

Economics Country Analysis
Words: 3685 Length: 10 Pages Document Type: Research Paper Paper #: 10554050
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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…

Works Cited

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.

Poverty the Economic Quality of
Words: 619 Length: 2 Pages Document Type: Case Study Paper #: 6837006
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There are 346 cars per 1000 population in the country (The Economist, 2011).

Andorra has an adult literacy rate of 100%. Life expectancy at birth is 82.43 years and the infant mortality rate 3.8 deaths per 1000 live births. The unemployment rate is 2.9%. The country has 64,500 cellular phones for 84,825 people, a rate of 0.76. The rate of landlines is 44.6%. There are 67,100 Internet users, or 79.1% of the population. There are no figures given by the Economist of the number of cars in Andorra.

These figures confirm the hypothesis that Andorra, despite having a lower GDP per capita, enjoys a higher quality of life. It has fewer cell phones, for example, in part because it has better landline connectivity. ith respect to human measures, however, Andorra's superior literacy rate, life expectancy and infant mortality rates point to a higher degree of success in developing human successes.…

Works Cited:

CIA World Factbook, various pages. (2011). Central Intelligence Agency. Retrieved May 10, 2011 from  https://www.cia.gov/library/publications/the-world-factbook

Germanys economic policies
Words: 1325 Length: 4 Pages Document Type: Essay Paper #: 22849041
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Germany has established itself as a successful country with a growing and stable economy. In terms of its economic policies, since 2014 its score has fallen by .2 placing it into rank 5 within the international top ranks. Of its many efforts to stabilize the country, the most notable is increased regulation, meaning pension-system expansions and a minimum wage (). Along with economic policies favoring regulation, Germany has remained strong in terms of employment growth and export performance, allowing for low unemployment rates and rising wages. While Germany has improved and stabilized, the rising influx of refugees has put a damper on the country's ability to create new policies for the labor-market.

Regardless, there are many positives in Germany's economic policies that has boosted tax revenue. The boost also comes in terms of reduction of debt-to-GDP ratio even with rising debt. Germany has done an amazing job of successfully addressing…

Turmoil and Instability of He 1970s the
Words: 1687 Length: 5 Pages Document Type: Term Paper Paper #: 75720204
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Turmoil and Instability of He 1970s

The subject of this study will be the 1970s. The 1970s were a turbulent time with several major events that influenced the economic growth. This decade was chosen because economists still argue about the causes of the economic downturn in 1973 and 1974. The oil embargo was blamed for many of the economic woes of the 1970s. However, there are some that claim that the oil crisis was fabricated and the situation was entirely fabricated by economic policy makers. The controversy surrounding this time period makes it an interesting subject of study.

How many goods and services a country produces is a good indication of the economic health of that country. The Gross Domestic Product (GDP) measures the production level of the country. Inflation and unemployment service to enhance the data obtained by the GDP and give us a good overall picture of who…

Works Cited

DeLong, J.B. America's Only Peacetime Inflation: The 1970s. National Bureau of Economic

Research NBER Working Paper No. h0084. Issued in May 1996 as published in Reducing Inflation: Motivation and Strategy, C. Romer and D.Romer Chicago: University of Chicago Press, 1997.

Layard, Richard, Stephen Nickell, and Richard Jackman. Unemployment:

Macroeconomic Performance and the Labour Market. Oxford: Oxford University Press.

U S History of Where Macroeconomics
Words: 2297 Length: 8 Pages Document Type: Term Paper Paper #: 94800682
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Since 1970, the economic growth in U.S. had increased in real terms at a rate of 3.16% per annum, up to 2001, when the American economy registered a slow down period and the economic growth amounted 1.7%. Since 2003, the growth rate averaged 4.62% per annum. Currently, the economic growth is heavily influenced by fiscal relaxation policy that led to increased investments and economic growth level. The average return rate on investment was of 14.6%, especially in the computer software and telecommunication sector.

Employment

The U.S. Labour Statistics office gives the data on the employment situation of the American society. This is important due to the fact that a high level of unemployment depicts the situation of a possible recession, while a low level of unemployment indicates that a certain nation cannot provide staff for the interested companies, and the labour force is insufficient for the demand on the market.…

Bibliography

1) Official Federal Reserve's website:  http://www.federalreserve.gov/,Retrieved  date: 10th of October

2) the Bureau of Economic Analysis website:

www.bea.gov, retrieved on 9th of October

3) National Bureau of Economic Research Website: http://www.nber.org/,retrieved on 10th of October

Intermediate Goods as the Name
Words: 726 Length: 2 Pages Document Type: Term Paper Paper #: 55534039
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As such, the amount repaid to the lender does not accurately reflect adjustments in its purchasing power. To compensate, nominal interest rates float; they change with inflation rates. Real interest rates, on the other hand, do factor in inflation rates. With this type of return rate, the borrower experiences an increase in purchasing power.

9. Cyclical unemployment arises out of a nation's reduction in productivity; it occurs when an economy produces less. Logically, this type of unemployment explodes during recessions and falls during times of recovery and/or prosperity; it follows the business cycle. Structural unemployment refers to a decreased demand of workers; it may be due to increased automation, outdated skills, or geographical incongruencies. Frictional unemployment occurs when workers are in between jobs; it is by nature temporary unemployment and reflects ordinary transitions in the labor market.

11. There exists a close relationship between technological change and the growth rate…

Economics the Industrial Age Was an Age
Words: 1953 Length: 4 Pages Document Type: Term Paper Paper #: 86334641
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ECONOMICS

The industrial age was an age of giant, mega corporations that were often bogged down by inefficient and outdated distribution, innovation, and production techniques. y contrast, the information age of the past 20 years or so has brought forth a new business form, a fluid congregation of businesses, sometimes highly structured, sometimes amorphous, that come together on the internet to create value for customers and wealth for their shareholders. This phenomenon has been commonly referred to as "digital capital," "information technology revolution," or "new economy." However, as both the Dow Jones Industrial Average and the Nasdaq soared to historic highs and record volatility in just a few short years, a widespread and quite fundamental disagreement emerged concerning whether or not the high-tech boom was nothing more than one huge bubble.

This paper analyzes and examines the present condition of the United States economy. Part II discusses what phase of…

Bibliography

Bedroussian, Armen, Devol, Ross C., Fogelbach, Frank, Goetz, Nathaniel H., Gonzalez, Ramon, R., and Wong, Perry. "The Impact of September 11 on Metropolitan Economies." January 2002. Retrieved at http://www.milken-inst.org/presrel/NationalMetroImpact Report.pdf on July 21, 2002.

Jordan, Meredith. "Economists: Turnaround in Early 2002." Retrieved at  http://atlanta.bizjournals.com/atlanta/stories/2001/07/09/story5.html . onJuly 21, 2002.

Moore, Geoffrey H. Business Cycles, Inflation and Forecasting, 2nd edition, 1983. Ballinger Publishing Co., Cambridge, MA.

EconEd Link." Retrieved at  http://www.econedlink.org/datalinks/index.cfmonJuly  21, 2002.

Country Report Spain This Report
Words: 2642 Length: 9 Pages Document Type: Term Paper Paper #: 25618498
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An interesting trend has been registered in the service industry, especially in the field of tourism. One of the main engines of Spanish economy in the past, now tourism in this country faces fierce competition from Eastern Europe countries. The beautiful resorts in Palma del Majorca and Costa rava must compete with low cost sea side resort, which offer similar services at incredibly low prices. Another field which needs reforms and reformulation policy is the agricultural and fishery one, which accounts only 4.1% out of GDP, although the important political forces attached to this sensible sector.

In order to be able to face the challenges and the opportunities on the regional and global market, Spain needs reforms in most fields of activity. Unemployment level is one of the highest in EU 9.2% at the end of 2005, while the rate of inflation was around 3.4 per cent in 2005, which…

Bibliography

1) Carol Matlack and Joan Tarzian - 'Spain: Immigrants Welcome', Business Week, May 21, 2007

2) 'Plain sailing no longer', the Economist print edition, 3rd of March 2007.

3) 'Spanish property - the pain in Spain', 26th of April 2007.

4) Human Development Index report, for the year 2006

macroeconomics and gas'stations
Words: 2265 Length: 7 Pages Document Type: Essay Paper #: 44342258
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.....gas station owners have no control over the price that they pay for petroleum, and only limited control over what they will end up charging the customer. The base price for crude oil is set on the basis of global supply and demand. Local prices reflect a variety of factor -- the crude price, cost of refining, cost of transportation, oil company markups and taxes (EIA, 2016). The price that consumers pay therefore reflects a variety of factors, almost none of which either the consumer nor the gas station owner has control over. This paper will discuss these factors in further detail, in order to clarify the dynamics of the oil market to better prepare to make a decision on buying four gas stations.
GDP Growth Rate

There are two dynamics at play here. First, the GDP of the area in which the stations are located influences gasoline consumption, by…

Macroeconomic and International Trade Analysis
Words: 2139 Length: 8 Pages Document Type: Term Paper Paper #: 13604361
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Note: current prices values are expressed in AUD billion.

Australia's Trade Situation

In the June quarter 2007, Australia's exports of goods and services increased by 0.5%, reaching the value of $54.6 billion. This increase follows a series of increases, as for the 2006-2007 financial year, exports increased by 10%, reaching $216 billion. egarding the volume of Australia's exports of goods and services, it increased by 0.8% in the June quarter of 2007, while for the 2006-2007 financial year, increased by 4%. The index of prices received for exports did not have an ascending evolution, since it decreased by 0.3% in the June quarter 2007. However, in the 2006-2007 financial year, export prices increased up to 6% (DFAT, 2007).

egarding rural goods, their exports fell 0.7% reaching $25.1 billion. The rural goods exports volumes fell 4% to 24.4 billion. The evolution of specific rural goods was the following: meat and meat…

Reference List

Australia (2007). Central Intelligence Agency. The World Factbook. Retrieved December 7, 2007 from  

Public Economy the Percentage of
Words: 970 Length: 3 Pages Document Type: Term Paper Paper #: 12521585
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The government of Canada has outstanding debt of approximately $550 billion. To service the debt, it issues bonds. The government has also announced previously that it is committed to fighting inflation. Please explain clearly how government debt management policy can lend credibility to the government's fight against inflation. In doing so, provide a clear explanation of the key differences between indexed and nominal debt.

hen a government wishes to curb inflation, one of the most effective ways to use the monetary supply to do so is to sell securities, in short through the sale of government bonds. By selling government securities, the government takes money or liquid capital out of the economy, and makes it more attractive to save rather than to spend money. Also, selling government bonds can reduce government debt. Reducing government debt is an important goal for any administration because the higher the debt, the less that…

Works Cited

Alfaro, Laura & Fabio Kanczuk. "Nominal vs. Indexed Debt: A Quantitative Horse

Race." Harvard Business School. January 2006. 20 Oct 2007.  http://www.people.hbs.edu/lalfaro/Nominal%20versus%20Indexed%20Debt.pdf 

U.S. Government Spending as a Percentage of GDP." Carried Away. Oct 2003. 20 Oct 2007.  http://carriedaway.blogs.com/carried_away/2003/10/us_government_s.html

Greece economic problems analysis
Words: 1063 Length: 3 Pages Document Type: Essay Paper #: 92834408
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Economic Environment

The economic environment of Greece is that of a capitalist economy, but with significant public sector contribution – about 40% of total GDP is from government activity. This speaks more to the relatively small size of the Greek private sector than to excessive government ownership of industry. Tourism is one of the major drivers of the Greek economy, accounting for 18% of GDP (CIA World Factbook, 2017). Thus Greece would be characterized as a mixed economy with some government-owned entities. Greece is a member of the EU, but has also received several bailouts in recent years, and struggles with tax collection, and overall economic development. Tax evasion ranges between 6-9% of total GDP in Greece, which makes it a significant economic problem (Georgakopoulos, 2016).

Recent Macroeconomic Data

In recent years, Greece\'s economy has flatlined. The country has received several infusions of capital from other EU countries, but there…

Apple expansion into Myanmar
Words: 3643 Length: 11 Pages Document Type: Essay Paper #: 55154244
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Global Economic Conditions

Apple operates in over 100 countries already, but there are still some markets available for the company. The one that has been chosen for the next international expansion in Myanmar. Apple already has a presence in most other Southeast Asian countries, but Myanmar has only recently become a democracy. It is a poor country, but relatively large, and is starting to see some strong economic growth. Foreign companies are starting to make their market entry. The trends for Myanmar are all quite recent. Five years ago there was little economic activity in the country, regular brownouts and a military junta. Today, there are signs of economic life. Moreover, where five years ago there was almost no broadband and it was prohibitively expensive, broadband in the country has been rolled out to most populated areas and is affordable.

Myanmar\'s economic story is mostly internal, but there is some…

Economy of China According to
Words: 860 Length: 3 Pages Document Type: Essay Paper #: 16175454
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Exports are also down significantly, yet despite these changes, the Chinese economy appears to be "independent and strong enough to not only cope with the global economic crisis but also to establish itself" as a major world economic powerhouse ("China Economy," 2009, Internet).

One of China's greatest economic strengths is based on foreign direct investment, for the World Bank estimates that around $80 billion U.S. dollars are invested in China on a yearly basis. However, one of its most important weaknesses is the existence of corruption at the local level, a situation which the Chinese government has attempted to eliminate through a slow and long-drawn out process. Nonetheless, economists predict that China, "via a sustained rate of growth will enable it to surpass the U.S." To become the world's largest and most powerful economy sometime in the early years of the 21st century ("China Economy," 2009, Internet).

As to unemployment…

REFERENCES

"China Economy." (2009). EconomyWatch. Internet. Accessed June 23, 2009 from  http://www.economywatch.com/world_economy/china .

Huntington, Samuel P. (1996). The Clash of Civilizations and the Remaking of World

Order. New York: Touchstone Books (Simon & Schuster).

Macroeconomic Indicators
Words: 1149 Length: 5 Pages Document Type: Essay Paper #: 15801506
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With the Fed shifting from quantitative easing (QE) to quantitative tightening (QT) in recent years, and the end of unconventional monetary policy, interest rates are set to continue to rise as the central bank reduces its balance sheet. With bond yields already going up and volatility at all-time lows, questions remain about how the market will react to this normalization process. One thing is for certain, however: the recent rise of prices across several asset classes has coincided with the years of QE beginning in 2008. Home prices have soared, bond prices have soared, equity prices have soared, college tuition has soared, and even precious metals have soared (along with cryptocurrencies in recent months). While some commentators are alleging that we are now in the “everything bubble,” the reality is that what is being seen is really nothing more than inflation in the works. The trillions of dollars of liquidity…

Macroeconomic Analysis the State of
Words: 660 Length: 2 Pages Document Type: Assessment Paper #: 65284836
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However, the recovery has not, as some might expect, included improvements to the unemployment figures or an increase in inflation. The unemployment figures can be explained partially in that unemployment is considered to be a lagging indicator. Inflation, however, is not a lagging indicator. As such, it would be expected to increase if the economy was increasing strongly, given that interest rates are very low. Not only is inflation not increasing, but it is decreasing, and long-term interest rates do not indicate that that the U.S. needs to be concerned with inflationary pressure either.

The case for fiscal stimulus is that government spending is going to increase the GDP. Given the equation GDP = C + I + G + X -- M, we can understand that consumer expenditures are going to remain relatively low in the current economy as the result of the high rate of unemployment. Business investment…

Works Cited:

Bureau of Economic Analysis: Real GDP percent change from previous period. BEA. Retrieved June 17, 2010 from  http://www.bea.gov/national/index.htm#gdp 

Bureau of Labor Statistics: CPI Detailed Report, April 2010. BLS. Retrieved June 17, 2010 from  http://www.bls.gov/cpi/cpid1004.pdf 

Bureau of Labor Statistics: Table a-10 Select unemployment indicators, seasonally adjusted. BLS. Retrieved June 17, 2010 from  http://www.bls.gov/news.release/empsit.t10.htm

Macroeconomics Forecasts
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remedy for the U.S. economy as the country has started to recover from the shock of September 11. Though the tragedy of September has drastically effected the economic growth of the country but the forces of recovery will soon lift the economy out of the recession. However, this turnaround is going to go a long way. The general opinion about the economy of the United States is that the recession will end around the first quarter of the year 2002 and the growth in real gross domestic product for the year 2002 is expected to be about 2.5% which will be definitely a huge achievement. However, this growth is expected to be slow but with a constant pace. According to the economic analysts the real GDP growth will pick up by the second half of the year 2002 and therefore most of the investors are expecting a reduction in the…

Works Cited

1) Business Week Online: This Recovery Will Be a Slog: from the World Wide Web:  http://www.businessweek.com:/print/magazine/conten 

2) The Revenue Outlook: from the World Wide Web: http://retailindustry.about.com/gi/dynamic/offsite.htm?site=http%3A%2F%2Fwww.cbo.gov%2Fbyclasscat.cfm%3Fclass%3D0%26cat%3D0

3) The Economic Outlook: from the World Wide Web: http://retailindustry.about.com/gi/dynamic/offsite.htm?site=http%3A%2F%2Fwww.cbo.gov%2Fbyclasscat.cfm%3Fclass%3D0%26cat%3D0

4) Economist Online: The Economic forecast:  http://www.economist.com/displayStory.cfm?Story_ID=S&+H0 *Q1#%

Eurozone Maastricht Treaty Euro Zone Treaty the
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Eurozone Maastricht Treaty

Euro zone Treaty

The European Community established the convergence criteria. These criteria was established in order to allow its EU Member states to take part in the Euro Zone, and using the Euro, as an official currency. The members of the European Union formed the Maastricht Treaty in 1992. The principle goals of the treaty were to establish an economic and monetary union, strengthen the democratic legitimacy of its institutions, better the effectiveness of its institutions, come up with the community social dimension, and also establish a unified foreign and security policy (Charles 1998).

The criteria contain several principles governing inflation rates, government finance, exchange rate, and long-term interest rates. The percentage points for inflation rates should not be 1.5 higher than the average the top three members states in performance of the EU. Government finance covers both the annual government deficit and the government debt. Under…

References

Charles K. (1998). Interest Rates: A Decision-Making Approach. New York, NY: Dryden

Press

David, J.H. (1999). "Advertising's Overdue Revolution" Speech delivered at the week

New York, NY: John Wiley & Sons

Economic Events 1980-1989 the Decade of Greed
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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…

References

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.

China Economy Examining the Current
Words: 2931 Length: 10 Pages Document Type: Case Study Paper #: 66547964
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China's Economy During and After the Economic Crisis

All of these factors created major growth for China for the three decades following the beginnings of its economic reforms, and then the financial crisis hit. China began the twenty-first century with a growth rate of 8.4% in 2000, peaking in 2007 with a 13% growth rate (IMF 2010). In 2008, this rate fell to 9.6% -- a significant drop, but still a significant growth rate as well (IMF 2010). The estimated growth rate in 2009 showed a slower drop to 8.7%, and forecasted growth in 2010 showed the rate climbing back up to 10%, with an average rate for the decade still at 9.9% despite the hiccup caused by the global downturn (IMF 2010).

A large reason hat China was so insulated form the economic shock that was so devastating in other parts of the world was because of the swift…

References

CIA. (2010). "China." World Factbook. Accessed 3 November 2010.  

Family Home Ownership
Words: 6651 Length: 22 Pages Document Type: Term Paper Paper #: 49971107
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The National Housing Act indirectly promoted the idea of lenders offering much longer-term mortgages with the currently accepted concept of monthly payments with the dual interest and principal payment scale. Amortized real estate mortgages opened the door for an average person to purchase and own a single family home.

As a result of the National Housing Act, the United States government inadvertently committed itself along with private lenders to insure long-term mortgages that could be held for as long as twenty or more years at an interest rate that was affordable. Although the process at first was bogged down by paperwork and bureaucracy it eventually caught on.

Part of the reason the process took hold was because in addition to guaranteeing the loans, the National Housing Act through the formation of the Federal Housing Administration also investigated properties and neighborhoods which added an extra measure of security and guaranteed real-estate…

Works Cited continued

Housing: The Key to Economic Recovery. Ed. NAHB. Natioanal Association of Home Builders. 5 Nov. 2004  http://www.nahb.org/fileUpload_details.aspx?contentTypeID=7&contentID=46 .

Longman, Phillip. "The Mortgaged Generation: Why the Young Can't Afford a House." Washington Monthly, Vol. 18 April 1986.

Meyerson, Martin, Barbara Terrett, and William L.C. Wheaton. Housing, People and Cities. New York: McGraw-Hill, 1962.

Peterson, James R. "Housing Plays Politics to Keep Growth Strong." ABA Banking Journal Vol. 92 (2000).

Risks and Challenges in Doing
Words: 1968 Length: 6 Pages Document Type: Essay Paper #: 13252953
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As a means to gain access to several million people who live a estern lifestyle, South Africa can be a good country to enter, but as a growth story it is much less exciting. Only when the GDP per capita of black and mixed-race South Africans begins to grow rapidly will the country be a truly attractive one for most companies. Arguably, the Human Development Index is a better measure, because it can reflect the overall potential of a nation like South Africa, where the development of one segment of the population is more critical to the market's potential than GDP, which is driven by another segment of the population.

A fourth reason why average per-capita income is not always the best indicator of an emerging market's potential lies in the Gulf States. Many Gulf States have very high average GDP per capita figures, driven by oil revenues. The lifestyle…

Works Cited:

Gibson, K. (2002). A case for the family-owned conglomerate. McKinsey Quarterly. Retrieved October 18, 2012 from  http://www.mckinseyquarterly.com/A_case_for_the_family-owned_conglomerate_1238 

Rajwani, S. (2011). How should firms deal with political risk? Cranfield University. Retrieved October 18, 2012 from  http://www.som.cranfield.ac.uk/som/p16495/Think-Cranfield/2011/May-2011/How-Should-Firms-Deal-with-Political-Risk 

Sargeant, N. (2006). What risks do organizations face when engaging in international finance activities? Investopedia. Retrieved October 18, 2012 from  http://www.investopedia.com/ask/answers/06/internationalfinancerisks.asp#axzz29f2QIadw 

Tata.com (2012). Heritage. Tata Group. Retrieved October 18, 2012 from  http://www.tata.com/htm/heritage/HeritageOption1.html

Macroeconomic Objectives Briefly Outline the Five Macroeconomic
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Macroeconomic Objectives

Briefly outline the five macroeconomic objectives governments generally seek to achieve

In each economy, the government always put forward some five macroeconomic objectives, which will help in keeping track of the economic growth. The five macroeconomic objectives are increase economic growth, control of inflation, reduction in unemployment, more equal distribution of income, protection of the environment.

Increase in economic growth

Increased economic growth acts as an agent for increased living standard which is always the aim of every government. The governments always seek in increasing the job creations to offer a source of income to the citizens. The government can only achieve this if it put forward strategies for increasing the economic growth. The increased economic growth has a direct relationship to the expansion of national production which acts as a prerequisite for economic development (Jonkhoff, 2011). The government also aim in increasing the national economic growth because…

References

Barras, R. (2009). Building cycles and urban development. Oxford: Wiley-Blackwell.

Barro, R.J., & Sala-i-Martin, X. (2003). Economic growth. Cambridge, Mass: MIT Press.

Great Britain. (2006). Sustainable development reporting by Government departments: Seventh

report of Session 2005-06. London: Stationery Office.

European Union or EU Is
Words: 3339 Length: 11 Pages Document Type: Term Paper Paper #: 73777715
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GDP went down due to weak domestic demand, which went further down after a decline. Somehow, it again rose by 0.1% in the first quarter and appeared to have pulled the economy out of recession. ut Portugal retained big trouble. In the last quarter of 2002, its GDP plummeted.8% from the third quarter and in the last quarter, it contracted by 1.3% from the previous year until the.3% in the third quarter of 2002. The economy continued to sag until the ank of Portugal itself observed the fall of business confidence to its lowest recorded level since the 1993 recession. Official unemployment rate increased to a high 49.6%, rising by 26.3% from 2001 (O'Flynn).

Unemployment was 6.7% in 2003, compared with 4.3% in 2002 (O'Flynn 2003). Labor unions in Portugal claimed it was more than 7.6% as against the 5% ceiling set by the EU, despite the fact that the…

Bibliography

Clapp, D. (2005). Spain's Economy is Vibrating and Growing. Group Communications, Inc.  http://www.facilitycity.com/busfac/bf_04_03_global1.asp 

Development Assistance Committee (2001). Portugal Development Cooperation Review. Organization for the Economic Cooperation and Development.  http://www.oecd.org/document/31/0,2340.en_2649_201185_1883871_1_1_1_1,00.html 

Giomo, C. And Jimenez, M. (2001). Economic Survey of Spain. Building Partnership for Progress. Organization for the Economic Cooperation and Development. http://www.oecd.org/document/36/0.2340.en_2649_201185_1912676_1_1_1_1.00.html

Internal Study Programs (2004). Portugal. http://www.studyprograms.com/focus_portugal.htm

Economy What Is the Inflation
Words: 631 Length: 2 Pages Document Type: Essay Paper #: 74984676
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It was the smallest monthly jobs growth since August 2003, when only 2,000 jobs were added, according to revised figures from the Labor Department.

6. How does the current structure affect the threat of cost push inflation or deflation?

There are no inflationary or deflationary signs in recent reports.

7. What is the growth rate of GDP?

The current growth rate of the Gross Domestic Product (GDP), which is the output of goods and services produced by labor and property located in the United States, increased at an annual rate of 3.5% in the first quarter of 2005, according to preliminary estimates released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 3.8%. The major contributors to the increase in real GDP, in the first quarter were personal consumption expenditures, private inventory investment, exports, residential fixed investment, and equipment and software. Imports, which are subtracted from…

References

Bureau of economic analysis (2005). Retrieved June 19, 2005, from Bureau of Economic Analysis Web site: http://www.bea.doc.gov/bea/newsrel/gdpnewsrelease.htm

Bureau of labor statistics (2005). Retrieved June 18, 2005, from Bureau of Labor Statistics Web site:  http://www.bls.gov/news.release/pdf/laus.pdf 

CNN (2005). CNN Money. Retrieved June 18, 2005, from CNN Web site:  http://money.cnn.com/ 

Social security solvency stimulator (2004). Retrieved June 19, 2005, from SS Web site: http://www.sscommonsense.org/Assumptions.html#GDP

Brics There Is a Tradeoff Between the
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BRICs

There is a tradeoff between the opportunity in a market and the risk of that market. The tradeoff between risk and reward can be seen most clearly with the comparison between the United States and the developing market countries. The U.S. has the best credit rating -- a relatively imperfect measure of market risk since it only truly reflects the risk of default on sovereign debt -- and the highest score for business environment. The U.S. also has, however, the lowest expected future GDP growth rate. Thus, the ideal BRIC nation to enter would be one that has the lowest risk and highest growth rate, but given that they all have roughly the same risk, the growth rate is probably going to be the best option for market entry.

The PDI is an important consideration, since the different markets differ in their composition. hile the EIU 5-year forecasts required…

Works Cited:

Economist Intelligence Unit modules:

Brazil, retrieved from  http://country.eiu.com.ezproxy.fiu.edu/Brazil 

China, retrieved from  http://country.eiu.com.ezproxy.fiu.edu/China 

India, retrieved from  http://country.eiu.com.ezproxy.fiu.edu/India

Economic Environment Analysis for a
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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.

isks

Despite the obvious advantages, there are risks of relocating to the Czech epublic the most notable would include: the underlying cost structure. While…

Reference List

1. Czech Republic, 2010, CIA World Factbooks. Available from

Economic Futures Facing Larson Inc
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It is worth noting that two economic consequences are likely to occur, particularly in the event of a V-shaped recovery. The first is that the Federal Reserve is going to wait to increase rates until the last possible moment, in the hopes of spurring greater investment and therefore job growth. This means that inflation is expected at some point this year. This inflation means that factor inputs will increase in cost. Larson can gain advantage over competitors if it can hold its wholesale cost stable in the face of an increase in the cost of factor inputs, since competitors may be forced to increase their prices. Careful control over its cost structure will allow Larson to do this while maintaining profitability.

Another potential economic consequence is a decline in the value of the Euro. Normally, Larson exporting products from America to Germany would be fairly easy given Germany's current account…

Works Cited:

CNN. (2010). Battle for downtown Bangkok hits economy. CNN. Retrieved May 15, 2010 from http://edition.cnn.com/2010/Business/05/14/battle.bangkok.economy/index.html?hpt=T1

Kirschbaum, E. (2010). Euro in danger of becoming unstable. Reuters. Retrieved May 15, 2010 from  http://www.reuters.com/article/idUSTRE6150N020100206 

Federal Reserve Bank of New York. (2010). Federal funds data. Federal Reserve Bank of New York. Retrieved May 15, 2010 from  http://www.newyorkfed.org/markets/omo/dmm/fedfundsdata.cfm 

BEA (2010). Personal income and outlays, March 2010. Bureau of Economic Analysis. Retrieved May 15, 2010 from  http://www.bea.gov/newsreleases/national/pi/pinewsrelease.htm

Nation's Economic Development Can Depend
Words: 2024 Length: 5 Pages Document Type: Essay Paper #: 96970881
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Citizens in the region's poorest countries, Paraguay and Honduras, make just above $4,000 per year, while those in the wealthiest countries, Chile and Mexico, make almost $15,000. The institutional legacy in the region is one clouded by inequality and corruption. In its brief on the region, the World Bank emphasizes the role of institutional development to alleviate poverty among vulnerable groups, a result in part of the lasting legacy of inequality due to colonial influences.

Asia. This region ranges widely from very poor nations such as Nepal (GDPpc of $1,100) to very wealthy nations like ingapore ($51,600). Because colonial dominance of this region was carried out by a relatively few European settlers, it was ultimately incomplete, leaving many of the region's own institutions intact or enhanced. The World Bank's comments on how governments across the region are reacting to the recent economic turndown are in line with an expectation that…

Sources of Economic Growth in China, 1952-1998. Issues in Political Economy, Vol 17.

World Bank. (2009). Regional Briefs. www.WorldBank.org. December 13, 2009. Retrieved from  http://www.worldbank.org/ .

Appendix 1

Relation Between IPRI and GDP Per Capita by Region

Source: International Property Rights Index, 2009. (http://internationalpropertyrightsindex.org/UserFiles/File/ex4_9relationbtwniprigdpbyreg.pdf).

Strategic Issues in Business New
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There are consumer movements and environmental lobbyists serving as watchdogs on businesses. These organizations may take businesses whose activities are affecting people or environment to court and ask that businesses to pay for damages. Government has also passed tougher health and safety laws that businesses should adopt while conducting business activities.

Findings

The findings of this paper reveal that New Zealand is a country that welcomes foreign investment based on the country economic development. While the economic development of the country may not be comparable to the economic development of European countries, Canada or USA, the country has established legal structures that protect foreign investment. Moreover, people in the country enjoy high standard of living compare to some European countries making New Zealander to have high purchasing power parity. While the country might have been affected by the economic recession in 2009 and 2010, the country has recovered in 2011,…

References

Department of States, (2011). New Zealand. U.S. Departments of States.

Link, A.N.(2001). Evaluation of Technology New Zealand. A report for the Ministry of Research, Science & Technology Infometrics Ltd. In association with Decision Research Ltd.

World Bank (2011). New Zealand. World Bank Data.

Marginal Propensity to Consume Refers to the
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marginal propensity to consume refers to the proportion of an increase in pay that is spent on the consumption of goods (Investopedia, 2012). The marginal propensity to save is the opposite -- the increase in savings that derives from an increase in pay. The two are opposites because it is assumed that whatever portion of a pay increase is not spent on consumption goes into savings. The two should, when put together, account for an entire pay increase.

The GDP of an economy is a function of consumption, business investment, government spending and net exports. Thus, there is a relationship between the marginal propensities and the GDP. hen wages rise, consumers will save some of those wages and spend some. The portion that is spent increases "C," or consumer consumption, causing an increase in GDP.

If somebody wanted to calculate how much of an increase GDP would occur from an…

Works Cited:

ECON Marco 2d edtion, by William A. McEachern

Investopedia. (2012). Marginal propensity to consume. Investopedia. Retrieved May 17, 2012 from  http://www.investopedia.com/terms/m/marginalpropensitytoconsume.asp

Macroeconomics Abbott Labs and Macroeconomics it Is
Words: 1016 Length: 3 Pages Document Type: Essay Paper #: 32479634
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Macroeconomics

Abbott Labs and Macroeconomics

It is a fact that the recent economic downturn affected every individual and company in some way, but companies that had solid business plans prior to the start of the crisis were better able to weather the financial storm. For example, a company that had a diverse range of business that included both products that depended the level of a consumer's disposable income and another group of products that are indispensable would probably be able to meet its financial goals despite global economic issues. Such a company is Abbott Laboratories. Because the primary business of Abbott is producing medical devices, pharmaceuticals and tests that are widely considered standards in the medical community (Abbott Laboratories, 2012), the company has been able to maintain its profitability throughout the economic crisis. However, macroeconomic indicators do have an effect on the continued economic viability of the company and they…

References

Abbott Laboratories. (2012). 2011 annual report. Retrieved from  http://www.abbott.com/static/content/microsite/annual_report/2011/yearinreview . php

Angell, M. (2012). Excess in the pharmaceutical industry. Canadian Medical Association Journal, 171(12).

Barnes, R. (2012). Economic indicators: Overview. Retrieved from  http://www.investopedia.com/university/releases/#axzz23ADx6TVd 

Roerhig, C., Turner, A., Hughes-Cromwick, P. & Miller, G. (2012). When the health cost curve bent: Pre-recession moderation in healthcare spending. New England Journal of Medicine. Retrieved from  http://www.nejm.org/doi/full/10.1056/NEJMp1205958

Role of Private Investment on
Words: 14411 Length: 40 Pages Document Type: Literature Review Paper #: 672069
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This also implies inadequacies in fiscal sustainability, which influences investments in private sectors.

The second channel happens through the level, composition and quality involved within the public investment, which shows the level at which the public investment replaces the private investments (Schmidt- Hebbel, Serven, & Solimano, 1996).

The final channel regards the level of taxation on the corporate earnings and the rules applicable in depreciations.

There have been arguments that fiscal policy and public expenditure reduces the private investments in two different manners. These include increasing the interest rates or lowering the private funds involved in financing the investments.

According to the neoclassical theory, the interest rate is also an imperative variable in finding the level of investment. Consequently, it results into a negative effect because it upsurges the interest payable in investments. Concurrently, McKinnon and Shaw, contends that this is likely to cause a positive relationship between the investment…

References

Shrestha, M.B. (2005), "ARDL Modelling Aproach to Cointegration Test," Proceedings of the 46th Annual Conference of New Zealand Association of Economists, Paper

No. 13, Wellington, July 2005.

Keynes, J.M. (1936). General Theory on Employment, Interest and Money., London,

Macmillan.