4. Think about the larger economic situation in your country right now. How do the overall economy and its various aspects impact your life and finances? Answer: The overall economy and its various aspects impact our lives and finances when we do stuff like pay taxes. Sometimes when taxes are paid, we do not benefit from them.
Having a wide gap between the upper and lower class doesn’t benefit the economy instead has a negative impact on it. For example, according to the Washington Post, “As income inequality grows, more and more resources are concentrated in the hands of the wealthiest. So, the idea goes, the wealthiest are better able to steer policies in directions that protect inequality at the expense of growth”. Because most of the wealth is in the hands of individuals who are at the top they have the power to do things their way. On the other hand, consumer spending plays a role in the economic growth of a country.
Such a cut-down affects the industry and anyone related to this sector. On the other hand, inflation rates have a negative effect on the growth of the advertising industry. Inflation rates affect the prices of goods and services which also affects the purchasing power. If the purchasing power of the consumers decline, manufacturing industries will experience low returns. They will shift the burden to the advertising industry by reducing investment in the industry and therefore affecting growth.
The government would tend to relying on borrowing from other foreign country when they faced a budget deficit. The crowding out effect started which would cause a huge burden to the country that is government did not allocate enough money for public goods and services, which will influence the economic growth. The country will have a wider deficit and higher debt pressure. (Ingram, n.d.) In conclusion, should the federal budget always be balanced? To sum up all the points above, I would to say that the federal budget should always be balanced, based on the many advantages that have been discussed above.
What makes it unfair is the impact it has by creating other inequalities. We also will observe why revenue inequalities a really impacting countries and prevent the lowest population to get a better life quality. First as we can obviously suppose, income inequalities creates economical and social inequalities. Naturally, revenue inequalities generates
There are also several controversies that also ruin their strong economic stability that this also hinder some foreign direct investors to think twice about investing and seek opportunities in their country. This report will focus more on the internal and external factors that are preventing the strong growth of China and give answers to the question of what are the factors that are hampering their growth? The significance of this report is the critical evaluation of the economic performance of this country to understand their weaknesses or strengths and identify the factors that challenges or threatens the economic stability of this
Economic factors play a crucial role in any investment decisions that are made for taking a gain and better return to the investor. Economic analysis and company performance forecasting are necessary for making investment management (Hiriyappa,2008). There is lack of investment management which has exerted burden over the company to keep getting revenue for current as well as new production plants. If the new plants were set up after examination of organization’s structure and forecast of sales and revenue, then the situation would have been easier. The company mainly depends upon reports by managers who are not communicating well with each other as they are not co-operative.
But in a long-run, when trade barriers continue, trade barriers will hurt national economy. One problem that emerges from trade barriers is rent seeking. When local industries tried to lobby the government to give them subsidies or increasing tariff rates to gain more profit, there are no additional value added to the total output thus, there will be wasted resources used for lobbying. This is one example of the inefficiency of trade
Stiglitz’s opinions on the ludicrous TARP bailouts and austerity packages have signified governmental flaws in protecting the interests of the 1 per cent. It has changed my perspectives on Laissez-faire Capitalism. Prior to reading this book, I believed that government should refrain from interfering with business activities in order to maintain economic growth and prosperity as a Capitalist society. However, the lack of control and regulations by the state can allow wealthy institutions such as banks to accumulate large sums of debt. Although economic growth and prosperity is necessary for the development of the state, there must be measures and policies to ensure that debt and austerity remains sustainable, mitigating any possibility of a widespread recession.
However, as the economic, social, political situation of nations differ, they set up artificial barriers on trade to protect their own interest. These measurements include tariff barriers, import quotas or non-tariff barriers such as TBT (Technical Barriers to Trade) and SPS (Sanitary Barriers and Phytosanitary Measures. However, trade barriers are known to bring losses to consumer surplus as the trading market is artificially interrupted by government policies. Although keeping a high trade barrier
a) Allocation, Valuation and Accuracy Inventory is a Current Asset in a Balance Sheet. The inventory was valued by using an incorrect code for the more expensive items of inventory. Probably, there is an error or the management was trying to provide a better picture of its financial position. If a misstatement of inventory has occurred there will be an impact on what the company reports as profit. An inaccurate record of inventory will result in the company not knowing its inventory position and not being able to meet customers’ orders.
Globalization has many negative effects in our world. The first problem with globalization is that international trade is exacerbating income inequalities between industrialized and nonindustrialized nations. Secondly, Global commerce is dominating the corps that want to maximize profits without a regard for the development of the country. Lastly, the countries involved with globalization lower their environmental standards in order to attract foreign business investments. In order to reform globalization, the government should change the ‘rules’ because they are unequal.