Employees: Employees can be acted towards ethically by organizations, by creating an occupational structure that fairly and equitably rewards them for their valuable contributions, health and safety at work, security, fair play. Shareholders: When operating ethically shareholders would like to maximise their return on investment. They would likewise need to guarantee that supervisors are behaving ethically and not risking investors’ capital by engaging in actions that could hurt the company’s reputation. Shareholder’s may not be happier as the return on investments would be lower when a business attends to operate ethically but it is possible to persuade them by clarifying the long haul results of the business. Customers: They are the most critical stakeholder for a business.
For example, the sales of Apple products in US will decrease if there is a rise in the US. Because of this the purchasing power will also decrease. Hence the sales will be reduced. Hence, to reduce the rise effect, Apple has purchased itself foreign currency. In this way, the sale of products in world-wide market will increase.
This lowers aggregate demand in the economy. Or vice versa, lower interest rates will stimulate the economy with higher spending, increasing demand. What is Fiscal Policy? On the other hand, fiscal policy involves changing tax rates and levels of government spending to influence aggregate demand for goods in the economy.Keynes ' model of government intervention focuses on government fiscal policy intervention. A decrease in taxes while increasing government spending means that there will be a larger government deficit, but demand will increase.
It is highly likely that there will be disincentive effect, discouraging the workers from working hard (Economics Help). Since the workers are aware of the fact that a huge proportion of their income will be taken away anyway, there will be less incentive for them to work hard. Also, such progressive tax can discourage the poor from struggling to climb the ladder. The mere fact that they will be provided with insurance and protection from the government will eliminate the need to get out of their current status. Nonetheless, other economists argue that the disincentive effect is highly unlikely to occur.
4.2 Reasons for inflation and deflation and ways to stabilize the economy Inflation can be defined as the increase in prices of goods and services over a period of time. Whereas, deflation is decrease in prices of goods and services over a period of time. In an inflation situation consumers stop spending money (as much they are used to), due to that production declines, it leads firms to cut down employees and exports will be dampened. Overall there will be a decline in the economy. So to overcome this a country can either use Monetary or Fiscal policy to stabilize the economy.
A Literature Review Investigating the consequences of austerity on British cities and the people within them? Introduction - Understanding Austerity, who and what it has affected? The UK's social situation has changed since 2010's government call for austerity, which has continued to today. Austerity is how a government changes their use of spending, through taxes and cuts welfare, to reduce the budget deficit; the spending of more money than it makes in taxes and other incomes received (Financial Times, 2018). Former conservative chancellor George Osborne called it "maxing out the credit card" (Stiglitz, 2017).
Therefore, their productive capacity will increase as they are able to produce more goods and services. The second importance is more cash in circular flow. As firms buy more capital goods, they inject more cash into the circular flow. Other than that, positive net investment spurs economic growth. As firms invest more in capital goods, gross private domestic investment increases, GDP
Tax is the amount of money imposed by the government on a certain product purchased by the taxpayer. Huge tax imposed on the banking industry would result in changing the lending rates of the banks. This would reduce the borrowing ability of the loan borrowers as a result of huge interest rates. However subsidies are the sum of money granted by the government to assist the banking sector in lowering their lending rates this has an effect of increasing the borrowing ability due to low interest rates. Continual increase in taxes has an effect of rabidly increasing the cost of loan, hence a deterrent factor to borrowers which would translate to financial crisis.
Tax Policy: The government could increase taxes on income. This reduces the disposable income of people. Consequently, there will be a reduction in their demand for goods and services. ii. In order to control inflation, the government could increase its borrowing from the Public and at the same time spend less of its revenue.
D, Hong. I, Metcalf. G.E (2001) states that, “the tax raises the overall cost of production, so the higher equilibrium output price chokes off demand for the output. Thus the tax has a substitution effect that reduces pollution per unit, and an output effect that reduces the number of units.” This gives an incentive for the polluters to reduce pollution, increasing the health quality of the society with a marginal benefit and lower marginal cost. Some examples of pigovian taxes are: carbon, excise and commodity taxes.