...With the recent government shutdown and the fiscal cliff debate over, many Americans are stepping back and asking “what is the current state of the economy?” Although the nation has been experiencing growth and a decrease in unemployment for the past three years, the national annual deficit of $1.1 trillion and the recent fiscal cliff debate along with the government shutdown reflect the nation’s struggle with furthering our economic growth and stability. According to the Bureau of Economic Analysis and the Bureau of Labor Statistics, GDP increased 1.1% in the first quarter of 2013 and 2.5% in the second quarter mainly due to an increase in business investments and goods exports and imports. What we can expect in the next few years is a slow and steady increase in the growth rate. However, many seem skeptical if the increase will be notable to say the least. Like GDP, unemployment has been on a steady decline for the past three years. The unemployment rate dropped from 7.8% in December 2012 to 7.3% in August 2013. This reports that there is an increase in job creations. However, what is more notable is that there is a higher increase in part-time jobs as opposed to full-time jobs, which leaves a bad taste for many because there is no certainty and sense of security. Household debt continues to decline in most categories like credit card debt. Yet consumers continue to remain cautious with a slowdown in consumer spending and spending for goods and services. If this trend continues...
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...Laura From: Subject: Voter Victor / Project Part 1 / U.S. Economic System The information provided below is for Voter Victor. For an understanding of the of the US (United States) economic system and how the government is involved, one must have an understanding of what type of economy the US has, the three primary levels of US government (city/county, state and federal), what is expected of these governing levels and what must be provided to them to support their functions (funding). By definition (Definition below) the US has a Mixed Economy but due to the limited government involvement, it can be said that the US has a Market Economy (definition below). An example of this production of electricity by a coal burning plant. There is no limit on how much electricity can be made or how much coal can be used but the government has regulated how much pollution may be produced as a result of burning the coal. Mixed Economy: An economy in which most economic decisions result from the interaction of buyers and sellers in markets but in which the government plays a significant role in the allocation of resources. Market Economy: An economy in which the decision of households and firms interacting in markets allocate economic resources. The three levels of government, local (city and county), state, and federal, will now be explained including what services they provide, how those services are funded and voter involvement. At the local level, the government provides...
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...surplus, and debt of the United States affects an Italian Clothing Company because; when it comes down to the United States deficit, it would cause the market to be over-run by foreign products. The rate in which a country is exporting is not at the level with it’s’ exports, a surplus would lead to more importation by the Italian Clothing Company and debt, it would cause the imports to be reduced (because many business partner would be hesitant to do business with the importer. Gross Domestic Product (GDP) Effects on Italian Clothing Budget Deficit Expansionary polices, such as those incorporated into an economy during a recession, have positive effects for imports. Increasing the money supply will increase an American consumer’s option to purchase more foreign goods such as Italian clothing (Colander, 2010). Budget Surplus Contractionary policies, such as those that may occur in an economy operating at its productive capacity will have a negative effect on the purchase or Italian clothing. Levels of trade with foreign countries will decrease from the peak productive period. Debt Initiatives to pay-down the United States debt could have a negative effect on the economy, thus reducing the demand for Italian clothing. However, if efforts to lower the debt are successful there will be less tax burden on consumers in the future leading to more opportunities for foreign trade. An Italian Clothing Company (Importing) When the United States has a deficit, it has a positive...
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...Reserve System is the central bank of the United States. It creates a trustworthy monetary system as well as making sure the economy of the United States is growing and secure. The Fed controls input and output of money in our economy and ensures that America’s supply of money is always stabilized with the amount of demand for goods that way neither inflation or recession happens. The Fed does this by buying and selling government securities, or investments. This is what allows the Fed to properly control the value of money. If inflation is about to occur, government securities are sold to take some of the excess money out of circulation. Vice versa for an impending recession in the economy, government securities...
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...in the US The unemployment rate in the United States has gone through changes in the past few years. It can fluctuate from high to low depending on our economy’s stability at the time. With the economy in a recent recession the level of unemployment rose. This affected millions of US citizens as well the US GDP levels. When citizens are out of work fewer products are being purchased and retail starts to decline. The US economy is slowly coming out of the financial crisis and recession within the last recent years. It wasn’t until the past year of 2011 did our economy see a positive turn around and unemployment levels began to decline. The Unites States economy has been showing increasingly positive signs throughout the year 2011. The unemployment rate fell recently in 2012 and is continuing to show good signs for a better economy. As of January 2012 the unemployment rate has fell to 8.3% in the Unites States. This is the lowest level the economy has seen since February 2009. Since August 2011 the unemployment rate has decreased by .8%. The widespread unemployment experienced in the last recent years is not the worst the US economy has ever experienced. The unemployment rate in the US averages 5.70 % from 1948 to 2010. The worse rate experienced was a record high for unemployment during November of 1982 with a 10.80% rate. There is hope though for the future with the unemployment rate slowly declining. In last several years the United States was experiencing...
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...The World Trade Organization welcomed with open arms Russia in 2012. This would open up trade possibilities for many countries in Asia, Europe and even the US. Some US companies, like Caterpillar, are already exporting a substantial amount to Russia. However, many in Congress do not want to grant Russia permanent normal trade status because of the way Russia has handled many political situations. As Andrew Kramer brought out in his NY Times article, “Congress has balked at the Obama administration’s request to grant Russia permanent normal trade relation status”. This could lead to retaliation by Russia against US companies by applying higher tariffs on their imported goods. According to Mr. Kramer’s article, the US company Caterpillar has sold 2 billion dollars worth of equipment to Russia in the last 5 years. However, President Obama’s administration, as well as his predecessors, has pushed to open up more trade with Russia. The WTO requires that all member nations have applied the same trade rules. Therefore, since the US is the largest financial contributor to the WTO, it would seem to be expected that it would play by the rules. So the WTO certainly has an effect on how the US constructs it trade policy with Russia. The pressure from inside the country, especially from those who think that Congress’ inaction could cost US companies a lot in tariffs, will be to allow Russia the same trade status as other WTO member countries. There is also the concern that other manufacturers...
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...factors within a nation’s economy have the ability to effect one-said nation’s aggregate supply and aggregate demand models. Of these factors, four will be explored through the course of this specific critique and it should be noted, that the specific nation to be observed is the United States of America. The specific factors to be observed in the United States’ economy are their unemployment, their expectations, consumer income, and interest rates. In addition to identifying these four factors and their economic effects, there will be identified what fiscal policies have been put in place by the United States government in order to aid the economy and finally, there will be an evaluation of these fiscal policies regarding their effectiveness from both a Keynesian economic perspective and that of a classical economist. Unemployment A nation’s unemployment rate, as can be expected, is calculated by dividing the total sum unemployed persons by the number of total persons available for within the nation. This formula yields the number that is considered the unemployment rate for whichever nation is in question, in this case though, the nation that is the focus of our investigation is the United States. According to the Bureau of Labor and Statistics website (2015), “the unemployment situation in the United States has been reduced to 5.5 percent. This decrease as reported in February of 2015 signifies an overall decrease of 1.2 percent in the United States unemployment rate just...
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...An Analysis of The Effects of the Financial Crisis and Its follow-up events on China and United States and the reactions of both countries Ruichen,Wang University of Illinois, Urbana-Champaign Introduction The recent economic world has been focusing on the Financial Crisis started in 2007 for a long time. It is considered as the worst financial crisis since the Great Depression of the 1930s by many economists and its impact spreads through all the continents except Antarctica (Reuters, 2009).There is no final assertion about if the crisis has ended, but it is still important for us to understand the economic knowledge about it. As the two largest economies in the world, China and United States are the most suitable examples for us to analyze (International monetary Fund, 2011). The reactions of the two involve various macroeconomic theories which are worth our attention. The interactions between the two make us better understand the two economy model and allow us to apply it in more events in the future. What is the most crucial is that the analysis of the Crisis will help us avoid such tragedies in the future. In this essay, this issue will be divided into the 11 parts and will be carefully analyzed. Through detailed narrations of background information, careful analysis of the government policies during the Crisis and their results, and objective comparison of these policies, an assertion of how to avoid and deal with future recessions have been achieved stating that ...
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...This article reflects America’s current family values. This is an older, but effective report. Heather Boushey was formerly a Senior Economist with the United States Congress Joint Economic Committee and before that, with the Center for Economic and Policy Research and the Economic Policy Institute. She has testified before the U.S. Congress and authored numerous reports and commentaries on issues affecting working families. “Heather Boushey.” Wikipedia: The Free Encyclopedia. Wikimedia Foundation, Inc. 13 July 2015. Web. 29 September 2015.” In this article Boushey argues that work has been winning the work/life battle- beginning with Mothers working outside of the home. Boushey also uses her skills as a former Senior Economist, to hone in on statistical data to prove the decline in family values, since Mother’s began working outside of the home. Heather Boushey article serves a dual purpose- or kairos. Boushey wrote this article stating her negative opinion toward today’s economy and how it affects family values. First, Boushey believes that mothers leaving the home to join the workforce has a negative effect on the well-being of our families and our family values, and secondly persuading us to measure how well our current American economy works for our families. Towards the end of the article Boushey tries to convince us, as voters to take action, by starting at home and telling our leaders that we will pay attention to work/life issues. The author starts out building her character...
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...firms are Procter and Gamble and Colgate Palmolive which represent the majority of the market share in the United States. Finally, it is found that innovation is a key factor in monopolistic competition because it represents the ability to differentiate products and attract more consumers. The main conclusion drawn from this paper is that the monopolistic competition is the most common model in the United States and the technology and innovation advances have allowed organizations to reach these types of markets and maximize profits. Venezuela vs. United States Economy Have you ever though why some countries are richer than others? Or what there is inequality among countries? All those answers are related to the economy of a country and their macroeconomic indicators. Today, macroeconomic is a crucial concept that we can see every day in the news; employment, inflation, and growth are some of those economy indicators. (1) But it is not so easy to say why a country is richer than other; or why the economy of a country with one of the highest reserve of oils does not have a good economic performance as other countries have. It does not depend on one only thing, there are several factors that increase the gap between two countries in terms of economic development and growth. This paper develops a comparative case study to illustrate the performance economy of two countries, and the level of income disparity...
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...Prices in the Long Run and Open Economies Name Institution Contents 1.0 Introduction 3 2.0 History of Economic Changes and comparing it to Forecast for the next Five Years 3 2.1 Changes in GDP 3 2.1.1 Economic Forecast 4 2.2 Changes in Savings 4 2.2.1 Economic Forecast 4 2.3 Changes in Investment 5 2.3.1 Economic Forecast 5 2.4 Changes in Unemployment Rates 6 2.4.1 Economic Forecast 6 2.5 Changes in Real Interest Rates 7 2.5.1 Economic Forecast 7 3.0 How Government Policies Can Influence Economic Growth 8 4.0 Influence of Monetary Policy 8 5.0 Influence of Trade Deficits or Surpluses 9 6.0 The market for loanable funds and the market for foreign-currency exchange 9 7.0 Recommendation based on the Achievement of the Strategic Plan 10 8.0 Conclusion 11 ALF Money and the Prices in the Long Run and Open Economies 1.0 Introduction (Creasey, Rahman, & Smith, 2012), defines economic growth as the rise of the monetary value of the goods and services produced by a country or an economy over a given period. Economic growth is simply the percentage change (increase or decrease) in the real GDP (gross domestic product) (Ahmad, 2013). "The economy of the United States is among the top largest economies in the world though it is facing stiff competition from other economies such as China," (Orhangazi, 2008). An analysis of the US economy reveals that it requires an aggressive...
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...Analysis of Foreign Direct Investments of North America Kristin Daughdril & William Cassidy Business Administration 418 Abstract Foreign Direct Investment (FDI) is an investment involving a long-term relationship and reflecting a lasting interest in and control by a resident entity in one economy of an enterprise resident in a different economy (UNCTAD). There are two types of FDI, inflows and outflows, which can be used to help determine the investment strategies and economies of countries engaged in FDI. North America has been the source of nearly one-half of all investment and almost three-quarters of the jobs created throughout the globe (Huggins, 442). North America is probably the most important continent when it comes to dealing with FDI. The three main countries of North America, the United States, Canada, and Mexico, all rank in the top 15 of world economies, proving them to be desirable partners in FDI transactions. The trends of FDI discussed in this report will be unparalleled to this information and can lead to some predictions on how future trends of the countries of North America will continue to be superior to that of the other continents of the world. Keywords: Foreign Direct Investment, FDI Inflow, FDI Outflow Foreign Direct Investment is investment of a company located in a different country either by buying a company in the country or expanding its business into the country. FDI can be done for many purposes. Companies may have tax incentives abroad...
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...Outlook for the Gulf and the Global Economy A report from the Economist Intelligence Unit Sponsored by the Qatar Financial Centre Authority The GCC in 2020: Outlook for the Gulf and the Global Economy About this research T he GCC in 2020: Outlook for the Gulf and the Global Economy is a white paper written by the Economist Intelligence Unit and sponsored by the Qatar Financial Centre (QFC) Authority. The findings and views expressed in this briefing paper do not necessarily reflect the views of the QFC Authority, which has sponsored this publication in the interest of promoting informed debate. The Economist Intelligence Unit bears sole responsibility for the content of the report. The author was Jane Kinninmont and the editor was Rob Mitchell. The findings are based on two main strands of research: l A programme of in-depth analysis, conducted by the Economist Intelligence Unit, which drew on its own long-term forecasts and projections for the six GCC economies, along with other published sources of information. l A series of interviews in which economists, academics, and leading experts in the development of the GCC were invited to give their views. In some cases, interviewees have chosen to remain anonymous. Our sincere thanks go to all the interviewees for sharing their insights on this topic. March 2009 © The Economist Intelligence Unit Limited 2009 The GCC in 2020: Outlook for the Gulf and the Global Economy Executive summary O ver the...
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...economics and producers effectiveness measured by absolute advantage for these economics/producers. For example; if the producer needs lesser amount of contributions/inputs to provide specific product, then this producer has an absolute advantage in producing process. Comparative advantage discusses the economy/producer ability to produce a specific product with a minimum opportunity cost comparing to another producer. "There is a possibility of each nation to have an absolute advantage in producing and delivering the products; however; the different nations could in any case have distinctive comparative advantages". The international trade theory based on two dynamic concepts; "Absolute and comparative advantage". The main difference between these concepts is that the absolute advantage measure nation ability to produce more profits per unit of beneficial input than another. However; the comparative advantage measure the ability that one nation has an absolute advantage in each kind of produce. Analyze measures of economic growth, and comparative and absolute advantage in international trade for the following countries: USA The economic growth indicates that the U.S economy has expanded by an annual 1.1 percent in the first quarter of 2016 which is higher than the projections of 0.8 percent. Based on the data given by the Bureau of Economic analysis, the positive economic growth...
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...that lead us to believe that international trade positively and negatively affects our economy. It gives examples of how global businesses use international trade to help them provide better services. It also provides the reader with an understanding of how international trade can increase capita per household. The paper also defines the argument that people not in favor of international trade frequently have. INTERNATIONAL TRADE’S POSITIVE AND NEGATIVE EFFECTS ON THE UNITED STATES ECONOMY Many have questioned over the years if international trade was truly helping the United States domestic economy or destroying it. Trade certainly has its way of bringing countries together and in the process it also provides an easier mean for companies to get the supplies that they need. However, it also tends to outsource jobs to other countries which take away from our country’s economy in a way. I am going to discuss the positive effects of international trade that help develop our country, and the negative effects of trade that give our country a disadvantage, the arguments between both sides, and then I am going to decide in my opinion whether international trade is advantageous for our economy or disadvantageous. Before discussing the effects on International trade is important to visit the background of why countries need to trade in the first place. Domestically countries cannot produce every item that they may need all by themselves. For example, a United States restaurant...
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