...Fundamentals of Macroeconomics Essay I. Ojeda University of Phoenix ECO/372 June 26, 2013 Chris D. Foster Fundamentals of Macroeconomics Principles of Macroeconomics is the study of what people do or use to coordinate good and services, to understand economics we must know the fundamentals of economics. Macroeconomics is the decision making on how economics evolves in our everyday lives. Principles of Macroeconomics include a variety of terms that helps to determine the Economy in United States. Some of the terms by most economists are; Gross Domestic product (GDP), Real GDP, Nominal GDP, Unemployment rate, Inflation rate, and Interest rate. The first subject that I will cover and discuss on this paper will include Gross Domestic Product (GDP). What’s Gross Domestic Product (GDP)? Is the standard living through its goods and services within the market value in a country in a period of time. Is the value of the amount of how much each household and businesses can produce and report each year in United States. GDP can also be measured by adding up the value of the domestic expenditure made at the end of the year. Those expenditures can be described as consumption; government expenses, investment, and total spend on exports. How Microeconomics can be impacted by GDP is when showing potential and economics are able to see what was expected. This can be used during recession to tract how the country’s economy is doing and...
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...Fiscal Policy Paper Titania Wilson and Marshall Turner ECO/ 372 January 23, 2014 Virgil Mesah-Dartey Fiscal Policy Paper The U.S.’s deficit, surplus and debt have an effect on tax payers because the government has the power to raise and lower taxes. When taxes are raised you will find that the people will become more affect by that decision. The people are affected when taxes on groceries, cigarette, alcohol beverages, and on loans, when these things are being raised people tend to spend less money on purchasing those items. When the people are careful about what they are spending the businesses will become affected by that as well. The way that it affects the future Social Security and Medicare user is that they are making it harder for our children and their children to be able to receive these benefits, there will be nothing left for them to get. It is already affecting the people now who are between the ages of sixty to sixty five; it is not easy for them now. Right now the deficit surplus is making it hard for the people who are not working and who are receiving unemployment check cannot get an extension on their benefits causing the long term unemployed to struggle even more. Federal benefits kick in after state benefits run out, and range between 14 to 47 weeks, depending on the state where a person lives. According to government figures, the average weekly benefit check is $300. The deficit surplus has an effect on the students of University...
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...Fundamentals of Macroeconomics ECO 372 August 7, 2014 Fundamentals of Macroeconomics Macroeconomics is the study of the economy as a whole. What happens in the economy as a whole is based on individual decisions that are made during economic activities (Colander, 2010). Economic activities can be defined as actions that involve the production, distribution and consumption of goods and services at all levels within a society ("Business Dictionary", 2014). Purchasing of groceries, a massive layoff of employees, and decreases in taxes are just a few economic activities that will be discussed along with the affects those particular activities have on government, households, and businesses. The flow of resources from one entity to another for each activity will be discussed as well. Let us begin with grocery shopping. Shopping for groceries is something that is done by each and every household. We all must eat to survive. The amount a household purchases depends on the prices of the products and how much money they have set aside for their grocery budget. Product prices are driven by the state of the economy. Consumers will shop around to find the “best deal” to stretch their budget as far as they can, especially if the economy is in a weakened state. Grocers will compete with other stores to try and keep the consumers coming back to their establishments. The more the consumers purchase the more successful the businesses will be. In many cases, lower income families...
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...Fiscal Policy Laura Wall, Melinda King, ECO/372 April 27, 2015 Sam Pirnazar Fiscal Policy There are many different policies that the government must oversee. One of those types policies is referred to as fiscal policy. Fiscal policy is a set of conscious decisions to make intentional alterations to taxes and government spending (Colander,2013). The purpose of these tactics is to either stimulate or slow down the government (Colander,2013). These policies directly impact tax payers and future social security and Medicare users because they create a deficit, surplus, and debt. The purpose of this paper is to discuss how this deficit, surplus, and national debt affect all have impacts on these citizens. To understand how a deficit, surplus, and national debt affect the economy, it is important to understand what each term means. First there is a deficit which is a lack of funding to cover a cost. A surplus is just the opposite of a deficit. An extra fund left over after the cost of something is paid for in full is called a surplus. Any long term running deficits, in actual currency terms, is considered debt. The United States (U.S.) has accumulated a large amount of debt, increasing its deficit more every year. Surprisingly, national debt has plagued us since George Washington’s presidency, a whopping $75,463,476.52 in 1791 (Steinbring, J., 2011). The U.S. deficit leaves very little in terms of money flow for the government. When deficits are...
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...Economic growth this year will continue to be slow. There will be a slight positive changes in many areas that effect the economy. Under the current law the economy’s offset are scheudlued to change due to the effects of the budgetary changes. Once this year is over, economic growth will be faster. “This will cause the unemployment rate to decline and inflation and interest rates to eventually rise from their current low levels. Nevertheless, the unemployment rate is expected to remain above 7½ percent through next year; if that happens, 2014 will be the sixth consecutive year with unemployment exceeding 7½ percent of the labor force—the longest such period in the past 70 years.” (http://www.cbo.gov/publication/43907) “If the current laws that govern federal taxes and spending do not change, the budget deficit will shrink this year to $845 billion, or 5.3 percent of gross domestic product (GDP), its smallest size since 2008. In CBO’s baseline projections, deficits continue to shrink over the next few years, falling to 2.4 percent of GDP by 2015. Deficits are projected to increase later in the coming decade.” http://www.cbo.gov/publication/43907 “However, because of the pressures of an aging population, rising health care costs, an expansion of federal subsidies for health insurance, and growing interest payments on federal debt. As a result, federal debt held by the public is projected to remain historically high relative to the size of the economy for the next decade...
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...The information within the paper will discuss and analyze the collapsing foundation of the economic structure in the United States. The widespread knowledge of economical stresses has become more apparent in recent years. These stresses include many different aspects such as; unemployment rates, expectations, consumer income, and interest rates which have been severely weakened in the United States` once prosperous economy. The issues can no longer be ignored nor overlooked as it is imperative that the nation acts accordingly, in order to preserve what is left our nation’s financial strength. A substantial part of these struggles are a result of an abnormal amount of government spending by the officials appointed in charge of the nation’s spending habits. A reorganization of government spending is essential for the strengthening of the economy. For example, the National Conference of State Legislators stated “Top state fiscal issues generally fall into two categories: the must-address issues and the ones lawmakers (including governors) would like to address. Must-address issues such as Medicaid and education arise every year because they account for $1 out of every $2 of general fund spending.” Naturally, it is extremely important to address educational and medical needs that should be met by residents of towns and citizens of this United States. Unfortunately, it has become apparent that some of the most economically important occupations are receiving pay cuts, layoffs, and...
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...Conclusion The auto sector is in unstable territory because the country still holds its breath hoping for the best but expecting the worst. This sector has lots of the nation's jobs as well as impacts the economic system on several stages. The government has already provided producers as well as buyers several incentives and plans in order to entice sales. Given the good reputation for the sector, it will recover over time; however the period of time just like a number of other factors is still not clear to the general public as well as economic experts alike. Conclusion The auto sector is in unstable territory because the country still holds its breath hoping for the best but expecting the worst. This sector has lots of the nation's jobs as well as impacts the economic system on several stages. The government has already provided producers as well as buyers several incentives and plans in order to entice sales. Given the good reputation for the sector, it will recover over time; however the period of time just like a number of other factors is still not clear to the general public as well as economic experts alike. Conclusion The auto sector is in unstable territory because the country still holds its breath hoping for the best but expecting the worst. This sector has lots of the nation's jobs as well as impacts the economic system on several stages. The government has already provided producers as well as buyers several incentives and plans in order to entice sales...
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...Part 1 Gross domestic product (GDP) – GDP is the total market value of all final services and goods produced in a given year in a given country. Real GDP – Real GDP is the result of the production activity within a given country at a specific years prices. If one compares two or more periods of time using the same year’s prices for goods and services then the result is a purchasing power comparison as seen over time. This happens because the inflation effects have been mitigated by using constant prices. Nominal GDP – Nominal GDP is simply GDP that has not been adjusted for inflation. Nominal GDP does not reflect purchasing power but does show how an economy has expanded and contracted in dollars. Unemployment rate – The most basic definition of an unemployment rate is those people who are unemployed but are actively seeking work and willing to work. It is typically expressed in the form of a percentage. Inflation rate – inflation is usually expressed in an annual percentage and is the price increase for goods and services. Interest rate – An interest rate is the percentage of the principal funds that is charged and paid for the use of money. It is expressed as an annual percentage rate (APR) for loans and annual percentage yield (APY) for interest earned. Whether one is experiencing a decrease in their taxes, is part of a massive layoff of employees, or is simply purchasing groceries,...
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...Fundamentals of Macroeconomics Gross domestic product can be described as a countries measure of goods and services produced in a particular interval based on value recorded in an annual period. The inclusion of public & private consumption (C), government spending/disbursement/expenditures (G), national investments for the purpose of expansion and further production (I), along with total net exports (Exports – Imports) (NX), are essential in its calculation. GDP=C+G+I+NX. GDP can be used as sign of a country’s ability to sustain the standard way of life for its people. Critics of its use as a measure argue that there are many more variables underground that go unreported and unaccounted for. The gap these variables create are large enough that they would have a significant effect on the results of calculation of GDP. An inflation-corrected view of the GDP is the description of ‘real GDP’. It gives a more accurate numerical value of GDP. ‘Real-time’ price changes are important in most anyone’s view and is as important to grasp when making predictions, making cost evaluations, deciding on investments, and wide variety of other functions of accounting and economic activity and interpretation. Nominal GDP can be considered to some as being somewhat useless. However, it can be useful in indirect dialogue of the GDP when discussing ‘general’ terms and ‘general’ numbers. The ‘general’ description of nominal GDP is the figure of GDP unadjusted for inflation. It can be...
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...University of Phoenix Material Definitions Define the following terms using your text or other resources. Cite all resources consistent with APA guidelines. |Term | | | |Time value of money |Definition |Is a price that is defined by a investor, and lender who has to wait until | | | |the loan is fully ready. | | |Resource you used |(Investopedia, 2015) | |Efficient market |Definition |Prices that are traded in the public financial market, which slowly release| | | |new information there is. | | |Resource you used |(Business Dictonary, 2015) | |Primary versus secondary market |Definition |Primary Markets is when there are securities made to a company particular | | | |needs. Secondary Markets are also known as stock markets that is performed | | ...
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...The U.S. Economy is fighting to bounce back after the 2008 recession. Once the recession had hit the economy, people had lost their jobs, lost their homes, and even lost their businesses. Throughout the years, the unemployment rate kept on increasing and increasing. Businesses were laying off their employees who made too much money and would hire younger individuals right out of college who would be happy with half of what the previous employees were making. In 2008, the inflation rate dropped to an all-time low of .1%. This gave the people an opportunity to afford more than what they were making, or in some cases, save their money and figure out how to overcome this recession. However, once 2009 hit, the inflation rate jumped up to 2.7%. A lot of people could not cope with the inflation, causing more and more problems. Currently, our interest rates have drop and so has our inflation. Our market is still in a big struggle; however, we are starting to see an increase in employment and house buyers. The Federal Reserve has dropped their discount rates, allowing more banks to loan out more money to individuals, which is increasing our money supply in hopes for the economy to get back on its feet. The International trade is when two or more countries exchange goods and services. When there is a surplus of imports brought into the U.S the domestic producers competing with imports suffer from lower prices and fewer sales. They have less revenue and resource owners doing the production...
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...Abstract Chilean miners trapped in a mine for 69 days were the longest rescue attempt ever. The help and support of the Chilean people, government, employee workers and family members were so supportive of each other; they showed a united front that helped this rescue attempt to go much smoother. For Chilean miners would this be enough support to help those that are sick to find the strength to hold on so that they reacquaint with their love ones. Will the drilling company be able to produce a drill that will be able to go down that deep and rescue the miners? Will it take them three or four months to drill a hole before the miners are free? Thirty-Three Chilean workers trapped in a mine Thirty-three Chilean miners trapped in a mine in San Jose under Atacama Desert with very little oxygen, food and water. All thirty-three miners were underground for 17 days before their first contact from the outside world. Codelco mining company is a state owned company in Chile, that was in charge to drill three small bore holes into the ground which was the first break through to reach the workers, allowing the rescuers to be able to communicate with them and send them food and medicine. The companies plan was to bore a rescue hole that would pull the miners up from 2,300 feet of the earth. First, they have to drill a pilot hole in the earth that is similar to a borehole. This would make the hole wide enough to establish some form...
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...State and regional unemployment rates had a modest change in August. 26 states documented an unemployment rate boost, 12 states and the District of Columbia posted an unemployment rate decline, and 12 states had no change. Forty two states and the District of Columbia registered unemployment rate decreases from a year earlier, seven states experienced increases, and one state had no change. The national jobless rate edged down to 8.1% from July and was one percentage point lower than in August 2011 (Bureau of Labor Statistics, 2012). In August, 54 metropolitan areas reported jobless rates of at least 10.0 percent, down from 99 areas a year earlier, while 123 areas stated rates fewer than seven percent, an increase from seventy three areas in August of last year. Yuma, Arizona, and El Centro, California, documented the highest unemployment rates in August 2012, with almost 30% each. Bismarck, North Dakota, recorded the lowermost unemployment rate, 2.6%. A total of 214 areas documented August unemployment rates below the United States total of 8.2%, 150 areas reported rates beyond it, and eight areas had rates equal to that of the nation (Bureau of Labor Statistics, 2012). As of August, Florida’s unemployment rate was 8.8%. In the current economy, many Americans are concerned that a rebound is still many years away. The hope and expectation appears to be that a new Presidential administration will help turn the tide on the depressed economy. However, expectations do not...
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...Gross domestic product (GDP) – Is the total market value of goods and services that are produced in a certain time frame. Real GDP – Is the same as above, but measured yearly at consistent values. Nominal GDP – Same as above, but measured at current values. Unemployment Rate – This is the measurement of individuals who are not working during the measured time. They may be willing to work but are not able to find work. Inflation Rate – The inflation rate is affected by the GDP and the result is a price increase for goods and services. Interest rate – is a rate that a lender sets for a borrower to pay back when taking out a loan, the decision of approval is dependent on several factors and the same factors can determine the interest rate the lender wants the borrower to pay. When considering the three economic activities (purchasing groceries, massive layoff of employees, and decrease in taxes) you will find that it is a circular motion where each activity has an effect on the others, causing each entity (government, business, household) to feel the effects. Think about a small town that survives on farming and a local paper mill as the citizen’s livelihood. Now take a look at purchasing groceries, we can see how it affects each entity in different ways. This economic activity would affect the government (local, state and federal) because we pay taxes on groceries and the items we do not pay taxes on are inflated to make up the difference, so the government is...
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...ECO/372 Final Exam Study Guide Created by ACCNerd.com How to Use this Study Guide – READ ME FIRST The following study guide will NOT have the same exact questions on your test! However, this study guide WILL help you ace the ECO/372 Final Exam. The guide covers the same topics and will help you gain a deeper understanding of the concepts. Best of all, you are still guaranteed a score of 90% or higher or your money back! Tip #1: Use CRTL+F to search a related keyword to quickly find the topic you need. Tip #2: If a topic is missing, please email us at support@accnerd.com. We can usually provide immediate custom support during normal business hours. 1. What is the name of the market where businesses sell products to households and government institutions? Goods market Explanation: The goods market is term that refers to the primary market where businesses interact with end users of products. 2. How would you describe Real Gross Domestic Product (GDP)? The market value of all final goods and services produced in an economy or country Explanation: Real GDP will be stated in the currency used during that year. It only includes final goods and services. 3. Who is included in underemployment figures? People who are working part time or not actively working a fulltime job Explanation: Underemployment figures show us the number of people whose skills are not being fully utilized. 4. The Bureau of Economic Analysis in the United States is...
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