...The causes of inflationary pressure on New Zealand’s economy The Official Cash Rate is the interest rate set by the Reserve Bank of New Zealand to meet or keep inflation under control since 1999. So it is a very important and basic monetary tool for New Zealand’s government to adjust or indicate the market interest rates with the banks in NZ. Generally, the market interest rates are set or held around at the RBNZ’S OCR level. For example, if the OCR is set higher than before, then the market interest rates for savers is going to increase as well. As a result, people in NZ will tend to spend less for goods and services and place more deposits with the Banks in NZ. On the contrary, people in NZ for loans or mortgages are inclined to borrow less money from Banks. It is because the interest rate for loans may have to be paid higher by individuals or businesses in NZ (RBNZ, 2012). Under this kind of situation, in recent years, due to there are rapid decreases on the OCR in New Zealand, It caused more and more lending activities of commercial banks to all kinds of individual and commercial loan applications. This sort of economic activity could result in the increase of inflationary pressure on the New Zealand’s economy. Whereas, the reason for the inflation of New Zealand is not just that simple or the rising inflation in recent years should not be completely attributable to the lending activities. But also should take other factors into account. In effect, the rate of inflation...
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...Course Chapters Review Ch. 1,2,3,5,6,7,8, 13 & 16 (Chapter 11 on Leading and Leadership Development presented on 07/03 ) • Chapter 1 Overview • Work in the new economy is increasingly knowledge based, and people, with their capacity to bring valuable intellectual capital to the workplace, are the ultimate foundation of organizational performance. Challenges of working in the new economy • Today, individual and organizational success must be forged within workplaces that are constantly reinventing themselves. • Themes such as empowerment, involvement, participation, self-management, and teamwork are common, as people manage careers described as flexible and entrepreneurial. • Definition and Role of an Organization • An organization is a collection of people working together to achieve a common purpose. • Organizations are open systems. They interact with their environments in the continual process of transforming resource inputs into product outputs in the form of finished goods and/or services • The External Environment of Organizations • The following factors impact the general or macro environment in which the organization operates. They are: o Political, Economic, o Social, Technological, o Legal and Environmental. (PESTLE) • Management must constantly monitor general environmental trends, and must be ready to make required adjustments in the ways their organization operate so as to gain COMPETITIVE ADVANTAGE • The Specific (task) Environment ...
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...The geography of the Southern Colonies influenced its economy and community set up. The Southern Colonies (tidewater only) was located along the Atlantic coastal plain. The soil was rich because of the many rivers. Open plains and gentle slopes provided great farmland and with a warmer climate and a longer growing season than colonies to the north. The rivers were wide, deep, and slow moving. The unique geography of the southern colonies impacted its economy in many ways. For example, cash-crop farming (plantations and small farms) is raising crops to sell. Cash-crop farming was basically the southern colonies main source of income. The gentle slopes, open plains, and rivers offered rich farmland and a long growing season was perfect for mass-producing crops. Many crops were mass-produced to support the South’s economy such as tobacco, rice, indigo, and cotton. Tobacco was grown in Virginia and North Carolina. Indigo and rice were grown in South Carolina and Georgia. These crops were traded for money because they believed you should export more than you import (mercantilism). To tend these crops slaves were traded to the Southern colonies from Africa. There were so many working the fields that plantation owners did not know the conditions they lived in. Because of the slaves and plantation owners social classes started to emerge. The slaves were at the bottom of the social class and rich plantation owners were at the top. These plantation owners were called the...
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...Question of the Day No.1 Read the Introduction to part IV & Chapter 16 A New World Economy The present state of the “Modern Part” is the result of the early modern period. Major events during the period between 1450 and the early 1500’s occurred so developments resulted in the manufacture and use of several technologies. Examples of this would be the rise of empire independence of countries, the discovery of America in the 1940’s, and the industrial revolution in late 18th century Europe. Economy was being dominant mostly because of Europe’s leadership in the industrial revolution with basic inventions such as steam engine. The first theme of these period was the introduction of Americas into the full global economic system helped intensify regional trade which is the second theme of this period and also typically forwarded biological exchange between Americas and the rest of the world which are called Columbian exchange. And parts of this biological exchange included people (Slaves). The result of this biological exchange was improving global food supplies. The increase in interregional trade has many sides. Some as referred by scholars is a proto globalization indicating a direct link between the acceleration of now international contacts and more contemporary patterns. The variety of goods expanded, many societies became dependent on imported goods, trade routes shifted. The Atlantic became a major artery trade. Trade within the Mediterranean became less important...
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...Running Head: A NEW HOUSE-ECONOMY A New House – Economy Axia College of University of Phoenix Principals of Economics October 23, 2010 When purchasing a home it is very important to take note of the economy at that time. At times the economy favors buyers and other times it favors sellers. To ensure that you purchase your home that the right time in the market, you must make sure you consider the marginal benefits and the marginal costs associated with purchasing a new home. Marginal benefits refer to the change in benefits over the change in quantity and marginal costs are the change in cost over the change in quantity. For example, during a recession it would not seem as though purchasing a home would be a good idea because the marginal costs would outweigh the benefits. During recessions the majority of consumers are spending less and trying to save as much as possible and therefore will not want to take out a mortgage on a home. The removal of the tax deduction on mortgage interest will negatively affect the housing market because it will take away one of the benefits to owning a home. This will make less people want to buy new homes. Having the mortgage interest deducted on your taxes each year gives an extra boost in the homeowner’s refund that could be used for home improvements or other expensive purchases. When I bought my home one of the incentives I was excited to take advantage of was the tax credit that was given for first time home buyers...
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...A New House Economy The strength of the economy is one of the factors that affect a person’s decision to purchase a home. When the economy is not doing well, people have to consider the security of their job and household income. It has to be considered if the marginal benefit of purchasing the home is worth taking the chance that you might default if you become unemployed. One might be less likely to make a large investment like a home when the stability of their job is in question. They might consider staying in their current situation, rather than moving, to save money in the event of a job loss. On the other hand, there are benefits to purchasing a home in a down economy. For those who are lucky enough to be in a secure job or own a business that happens to be thriving in a bad economy (because it sells or produces a substitute item that is in higher demand in a down economy), purchasing a home in this environment is advantageous. Home prices will be considerably lower (buyers-market) allowing you to purchase more home for your money. Also in a down economy, interest rates are much lower than in a healthy economy as the government tries to encourage lending and borrowing. As a result, the money you borrow is done so less expensively. When the economy is doing well, people enjoy more job security and have higher incomes; this optimism makes people more willing to make big purchases like a home. During periods of economic growth, there are many more buyers in the...
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...A New House-Economy Checkpoint Chante Yokley XECO/212 December 11, 2011 John McGee A New House-Economy The FED impacts national fiscal policies through interest rates, which impacts the demand in the housing market (Mankiw, N. G., 2007, p. 657). The Department of Treasury introduced a refinancing program that allows consumers to refinance mortgages to take advantage of lower interest rates. The Fiscal Policy impacts prime lending rates, which are the determining factor in consumer borrowing. The higher lending rates mean a higher price paid for a new home. As rates increase, demand decreases causing a decline in the housing market and an overall lag in the economy. A contractionary fiscal policy would provide a short-term decrease in the money supply but would provide lower inflation in the long-run, reducing lending rates and increasing the aggregate demand in the housing market (Mankiw, N. G., 2007, p. 778, pp. 5). The strength of the economy would create an increase in marginal benefits, exceeding marginal costs by strengthening home owner’s equity. The government offers programs and tax incentives (deductions) that subsidize home ownership, making it affordable to be a homeowner. One in particular is the Mortgage Interest Deduction (MID), a popular tax break for middle to higher class citizens; research shows that the beneficiaries from the MID are in these societal classes (Stansel, Dean & Randazzo, Anthony, 2011, executive summary, p. 6). There...
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...Purchasing a new home is a big decision and should not be entered into lightly and should be given a lot of thought. The marginal benefits and the marginal costs associated with the decision to buy a home can be altered by the state of the economy. Some things can be affected by the actions of the government’s efforts to strengthen economic conditions. An example could be as we talked about in the economic readings; when banks are allowed to lower their reserves, this will make more money available for investment groups as well as potential home buyers who need a loan. This would more than likely result in a decrease in interest rates and strongly encourage borrowers to shop for a loan to buy a new home. If you remove the tax deduction for mortgage interest this can remove one of the strongest incentives some have when purchasing a home. A lot of people will not enter into a long contract that does not provide any sort of tax break? Most adults young and old would find it hard in our current economy to put themselves in a position to have a mortgage they may not be able to pay when there is no tax break. When there are changes in federal income tax rates this factor could also affect my decision. If taxes are high, I have less money earned due to taxes to spend on a mortgage payment. When taxes are low, then I would be more likely to consider making a large monetary commitment such as home...
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...Running Head: New House New House: Economy Deanna Arneson Explain how the strength of the economy as a whole could affect the marginal benefits and marginal costs associated with a decision to purchase a home. During our current economic situation, large amount of forecloses and high rate of empty homes, I would say the marginal benefit is that there are several homes on the market to choose from. Because of this plentiful amount of homes available the purchase price and value of the homes is dropping. This makes the marginal costs of a home lower because the amount of homes on the market is higher than it used to be and the price is lower for buyers. How does the removal of the tax deduction on mortgage interest affect the housing market? If the government was to remove the tax deduction on mortgage interest the mass population would look closely into owning a home verses renting a home. One of the benefits to owning a home is the tax deduction you have each year. If you do not have that deduction, will that mean you will need to only pay taxes on your home? What is the benefit to that? I think that several people will make the choice to rent rather than owning a home. How do other changes in government spending and taxes affect your decision? Property taxes and local taxes such as school taxes would make a big impact on my decision to purchase a home. I know that the property taxes in my county are extremely high for the area and it makes a harder impact...
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...OXFORD REVIEW OF ECONOMIC POLICY, VOL. 14, NO. 2 WHAT’S NEW ABOUT THE NEW ECONOMIC GEOGRAPHY? PAUL KRUGMAN Massachusetts Institute of Technology Since 1990 a new genre of research, often described as the ‘new economic geography’, has emerged. It differs from traditional work in economic geography mainly in adopting a modelling strategy that exploits the same technical tricks that have played such a large role in the ‘new trade’ and ‘new growth’ theories; these modelling tricks, while they preclude any claims of generality, do allow the construction of models that—unlike most traditional spatial analysis—are fully general-equilibrium and clearly derive aggregate behaviour from individual maximization. The new work is highly suggestive, particularly in indicating how historical accident can shape economic geography, and how gradual changes in underlying parameters can produce discontinuous change in spatial structure. It also serves the important purpose of placing geographical analysis squarely in the economic mainstream. I. INTRODUCTION The study of spatial economics—of the location of production—has a long if somewhat thin history. Von Thünen’s (1826) analysis of land rent and use around an isolated city was roughly contemporaneous with Ricardo’s statement of comparative advantage; the location analysis of Weber (1909), the central-place theory of Christaller (1933) and Lösch (1940), the regional science of Isard (1956), and the urban systems theory of Henderson...
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...landed in 1492, the English people, French, and Spaniard extended their territories and assimilated Indian by assigning missionaries and governors to develop Catholic schools in the New World. The Catholic schools in European colonies were established not only for educating European¡¦s own Catholic descents but also for making Saint Mary and Jesus Chris known by Indians. Spanish priests had accomplished better missionary tasks than the other European colonial empires like France and England. Their Catholic preaches arrived the in southern parts of the Mississippi River before 1700, and the west and south area of the Mississippi after 1700. I believe the reason why Spanish accomplished the missionary job more successfully than the others is that they paid enough reverence to Indian¡¦s tribe traditions and customs. Spanish missionaries understood that the tribe people have to retain their habits like complex cosmology worship, hunting game, and defending practice; therefore, they preserved Indian¡¦s traditional activities when converting them into Catholics. Spanish bishops transformed Indian¡¦s superstitions into Christianality step by step gently and gradually. At the same time, the Spanish missionaries traveled and fight together with tribe military soldiers from hostile attacks and introduced new industrialization technique to improve Indian¡¦s agriculture. This apparently revealed Spanish¡¦s determination to assimilate Indian and to transfer Spanish civilization to improve...
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...8. Use sources 10, 11 and 12 and your own knowledge ‘The New Deal failed to revive the US economy’ Explain your answer, using Sources 10, 11 and 12 and your own knowledge of the issues relating to this controversy. It is thoroughly debated whether the New Deal did actually provide the momentum to boost the US out of the depression, or whether it was merely coincidental factors such as WWII which provided the real recovery. Johnson insists that the New Deal was in fact counterproductive and hampered the economy and that it was WWII that masked the New Deals failure and helped reboot the economy. This view is rebuffed by Jenkins and Shakes who believe that the New Deal, although far from being perfect provided the stability for recovery to occur and thus kick-started the economy. Johnson overall picture of the supposed New Deal recovery was that is was ‘slow and feeble’ with its impact being virtually non-existence or in fact stunting growth. This is reinforced by Shlaes, ‘NRA was so inflexible they frightened away capital and discouraged employers from hiring workers’. With Johnson stating the only ‘good year was 1937 when unemployment being at 14.3%’ though rising again to 20% in 1938. Throughout the 30s the levels of unemployment never dropped below 10% and that it was only when ‘America on the brink of war’ that unemployment passed below 5% and production levels ‘finally passes 1929 levels for good’. In Johnson view it was WWII which eradicated unemployment and ramped up...
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...CRITICAL REVIEW ON STRATEGIC MANAGEMENT ON HUMAN CAPITAL IN NEW ECONOMY Zubaidah binti Haji Harun Email address : zupian@yahoo.com PhD Candidate,Faculty of Business Management, Universiti Teknologi MARA, 40450, Shah Alam,Selangor ABSTRACT New economy can be meaning of many way. It can be defines knowledgebased economy, globalize economy, digital economy. When economy need knowledge more than other tangible assets, the human resources are become the vital resource and assumed as an asset to an organization. Knowledge workers or called human capital have different characteristics contrast to non-knowledge workers. To be competitive advantage in present marketplace, human capital should be treat as a capital to an organization and must be managed significantly and neatly. Human Resource Department becomes an important part to deal with a lot of challenges in managing human capital in new economy. Keywords : New economy; Knowledge – based economy; Human capital; Knowledge Management; Intellectual Capital INTRODUCTION In this 21st century, the global economy was shift to new economy or be known as knowledge – based economy (k-economy) There is no longer agricultural and industrial economy but we are now entering to knowledge society which is work is linked to knowledge and learning. The rise of the new economy, the knowledge component of products and services has increased dramatically in importance and has become the dominant component of customer value. There are two types...
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...Assignment New vs Old Economy NEW VS OLD ECONOMY Define the following: Old Economy: | an economy based on agriculture and manufacturing as opposed to high technology; also, a former economic system or state | New Economy: New industries, such as biotechnology or the Internet, that are characterized by cutting-edge technology and high growth. Fill in the following chart: CONTRASTS OLD ECONOMY | NEW ECONOMY | Requires control | Requires collaboration | Value is measurable | Value is emergent | Predictive | Experimental | Proximity is important | Location less significant | Assembly line focused | Community Focused | Clear boundaries and definitions | Shifting borders and consensus meaning | labour-intensive economy involving manufacturing and the movement of physical commodities | the "virtual" economy of computers and electronic commerce | creates value in a product through a simple formula: The object’s value is the sum of its obvious parts | Produces additional value by a complex interaction of the obvious parts with intangibles, like design, engineering, brand and cachet. | Pick any two points that you put in the chart and explain in your own words what it means. 1. The "virtual" economy of computers and electronic commerce (new economy). Vs labour-intensive economy involving manufacturing and the movement of physical commodities (old economy). Basically this point is explaining the change in the economy from old to new. In the old...
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...An economy or economic system consists of the production, distribution or trade, and consumption of limited goods and services by different agents in a given geographical location. The economic agents can be individuals, businesses, organizations, or governments. Transactions occur when two parties agree to the value or price of the transacted good or service, commonly expressed in a certain currency. In the past, economic activity was theorized to be bounded by natural resources, labor, and capital. This view ignores the value of technology (automation, accelerator of process, reduction of cost functions), and innovation (new products, services, processes, new markets, expands markets, diversification of markets, niche markets, increases revenue functions), especially that which produces intellectual property. A given economy is the result of a set of processes that involves its culture, values, education, technological evolution, history, social organization, political structure and legal systems, as well as its geography, natural resource endowment, and ecology, as main factors. These factors give context, content, and set the conditions and parameters in which an economy functions. The largest national economy in the Americas is the United States,[1] Germany in Europe,[2] Nigeria in Africa[3] and China in Asia.[4] A market-based economy is where goods and services are produced without obstruction or interference, and exchanged according to demand and supply between participants...
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