We shall begin the paper with defining what progressive and regressive tax systems are. A progressive tax is one which places a larger percent on the high-income segment of earners than what it does from the low-income segment of earners. This form of tax depends upon how quickly a change arises in the tax rates in comparison to an increase in income. Regressive tax system on the other hand, which is not as popular as the former, is a tax that takes an increased percentage of income form the low-income earners than what it does from the high-income earners in an economy. Progressive Tax: According to Encyclopedia Britannica, a progressive tax is a tax levied at a rate that increases as the quantity subject to taxation increases.
Many people are strongly debating whether or not the rich should pay higher taxes. I believe it should be that the rich do pay higher taxes. When times in the economy are rough, the government needs to look consider at how they could bring in more money. Charging the wealthy higher taxes could be a strategy the government could use., and the wealthy people are the ones who could afford it. But, taxing the rich more also wouldn’t be impartial that fair because the government already wastes much of the money pay they collect.
On the other side, low-income earners are not expected to purchase the company products in bulk or frequently. Nevertheless, consumer income is widely affected by the rate of inflation which determines the amount of money they receive as salaries and wages as well as the prices of the company’s product. Inflation is widely defined as the continued increase in prices of products and consumers.
The Economic factors are determinants of an economy’s performance that directly impacts a company. These factors include inflation rates, interest rates, exchange rates and economic growth. These affect how businesses operate and make decisions. The economic climate in the country is of major concern to every company as it has impacts on the business and consumer spending. For example, the exchange rates can affect the costs of the supply and price of imported goods and exporting goods in an economy.
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.
First of all, from financial crisis to the economic level, a direct impact on exports. In the field of economic upheaval brought people psychological change, they are increasingly losing a sense of security. John Lipsky (2008) said, “it is conceivable that the harm of it how much deep is the people of the world must face a major challenge”. The financial crisis has a direct impact to the individual life. Inflation, business failures, economic difficulties to reduce people's ability to pay, this not only makes the increase in the number of people cannot afford the mortgage,
Unrestrained speculation and margin buying were the two big things in the Stock Market. Speculators bought stocks with money they borrowed. They would used those stocks as collateral to buy more stock. So if that person could not repay the loan, they would forfeit their stocks. Margin buying was a way of attracting the less wealthy to buy stocks.
Those who advocate for higher taxes argue that the money taken from the rich could be put to uses like healthcare and education. The side that is against higher taxes debates that the long term effects of taxing the rich could cause a tremendous amount of damage, particularly with losing jobs. The rich should not be taxed more because it takes away the right to earn, and keep, a considerable amount of money and it can both damage the economy and lead to socialism which in turn has a high probability of leading to widespread poverty and a corrupt government. Taxing the rich negatively impacts the economy of a country in a plethora of ways. Taxing of the rich and businesses coincide because many of those who are wealthy own a business.
A budget surplus occurs when tax revenue is greater than government spending. Therefore, the government can use the surplus revenue to pay off the national debt. Budget surpluses are quite rare in modern economies because of the temptation for politicians to spend more money and cut taxes. A budget surplus is appropriate when the economy is in the growth phase of the economic cycle. In a recession, demand is depressed, and it is expected to have a budget deficit.
People 's burden is increasing. That is one of the reasons. Conclusion: The Great Depression has many reasons. But they are all based on a vicious circle. The fundamental problem is the industrial development under, agricultural products devaluation and wages too low, lower class does not have the purchasing power, wealth is concentrated in the upper hand, the circulation of money appear obstacle.
Hoover came with more ideas on the problems that the United States was up against; like the Great Depression. 5. There are many factor that cause the Great Depression. The overproduction of too many people being layoff, due to the factories going out of business. There was a crisis in the farming after the war deflationary and the prices dropping, with reduced demand on the same supply.
Oil and gas companies use LIFO, much like the rest of the business world, to gain the tax benefit that LIFO provides. However, LIFO allows Chesapeake to record the cost of inventory at the most recent price paid- even though some of the inventory was purchased when oil was selling at a much lower price. Profits would then be understated for that particular year since LIFO would yield a higher cost of goods sold. Although it is legal to use LIFO as an accounting method for inventory Chesapeake could change the estimates and assumptions used to calculate LIFO balances and the LIFO reserve. Further changes to LIFO balances can exacerbate the effect that LIFO has on the income statement.