Economic analysis is important in order to understand condition of an economy. The level of economic activity has an impact on investment in many ways. If the economy grows rapidly, the industry can also be expected to show rapid growth and vice versa. The degree of economic growth is directly proportional to the stock price i.e. when the economic activity is high, the stock prices are also high indicating the prosperous outlook for sales and profit of the firm.
At this current rate of population growth is now a significant burden to human well-being. The trend of the population growth in the world is related to the development of the country where, there is a very sharp decline in fertility in the developed countries, and how long it has lasted, has been completely unforeseen. Conversely, developing countries have accounted for 97 percent of this population growth. (Prborg, 2015) The relationship between population growth and per capita income can be both a positive and negative. It is a positive impact as the expanding population in a country leads to economic development which encourages competition in business activities, stimulating market growth.
Definition Entrepreneurship, economists, politicians, community leaders and citizenship are usually interested in the economic growth of a country and how it affects business cycles in the end. Mohr et al. (2015:410) define economic growth as the annual rate of increase in the total production or income in the economy while Noel, T. P. (2012) refers economic growth as an increase in the productive capacity of an economy as a result of which the economy is capable of producing additional quantities of goods and services. The importance of economic growth From economists’ perspective, economists must be able to analyze a country’s current economic environment. Mohr et al.
There has been an increase in minimum efficient scale. If minimum efficient scale rises, the domestic market may consider too small to meet sales demand, which would be spurring mergers and acquisitions to gain economies of scale. Secondly, the deregulation of financial transactions has increased the profitability of enterprises. The
His ‘dash for growth’ led to the Barber boom. Unfortunately, it also led to inflation and unsustainable growth (BBCNEWS, 1999). 3.3. Supply Side Policies Supply side policies refer to the policies that are design to increase the rate of the economy growth in a long run by improving the productivity and efficiency of the
This study shed light on the time frame of the examination of immigration’s economic impact and indicated that immigration’s negative and positive impacts may both be limited to a certain period of time and is closely related to the demographic structure of immigration. Peri (2013) pointed out that immigration’s effect on productivity has been overlooked in earlier analyses. Together with many other scholars, Peri conducted a series of studies examining the relationships between immigration and productivity in the United States. Peri suggested that immigration’s productivity effects mainly come from stimulation to investment and innovation, as well as from promoting specialization and increasing efficiency. In the medium to long run, this productivity increase drove wage growth.
It includes changes in structure. Still in development, economic and social structures changes. This new structure is mandatory and of a certain class or group in society as well balanced distribution of welfare by taking a share of the growing prosperity of the region as well provision is essential. Development is also growing solving social problems. The main objective of development, to ensure the people's increasing life better economic possibilities in solving social problems is to
Cost Push Theory Cost push theory is where inflation is due to direct result of increase in the cost of production that is increase in prices of raw materials, increase in labour cost (wages & salaries). Cost push inflation can be also defined as prices have been “pushed up’ due to increase in price for factors of production. So as the cost push theory says inflation is caused by increase in cost of production factors, this leads to decrease in the demand for raw materials, which leads to decrease in production and demand stays consistent, than this leads to increase in price (inflation). The figure 1.0 shows what happens in the cost push theory. If the firm is operating at point Q1, P1 any increase in price for factors of production will lead to increase in price that is moving from point P1 to P2 quantity supplied decreases due to increase in cost for factors of production moving from Q1 to Q2.
What is economic growth? It is referred to as the rise in the market value of the goods and services that are provided by an economy. It is measured in terms of percentage of the gross domestic product (GDP).Economic growth helps in improving the standard of living for an individual as well as a community. In today’s competitive world it is very important to help forms of businesses carry out sale and purchase of goods and services so as to develop the economy. Seeing this ongoing development in our economy in today’s world, we have come a long way.
By progress of wealth, he meant economic development which could be achieved by increasing the wealth of the country. The wealth of the country depends partly upon the quantity of produce obtained by its labour, and partly upon the valuation of this product. But, “wealth of the country does not always increase in proportion to the increase in value, because an increase in value may sometimes take place under an actual diminution of commodities”. Population increases in a geometrical ratio whereas food supply increases in an arithmetic ratio. This disharmony will lead to wide spread of poverty and starvation which would only be checked by natural occurrences such s disease, high infant mortality, famine, war or moral restraint.