Economy Essay

TABLE OF CONTENTS CHAPTER ONE: INTRODUCTION .................................................. 1
Background ............................................................................. 1
1.4 Climate change adaptation and mitigation ...................................... 9
1.7 Problem Statement .................................................................... 11
1.8 Objectives of the study ............................................................... 13
1.9 Research questions .................................................................... 14
1.10 Significance of the study ............................................................ 14
CHAPTER TWO: LITERATURE REVIEW ....................................... 16
2.0 Introduction ............................................................................ 16
2.1 Conceptual Framework .............................................................. 16
2.2 Empirical Literature ................................................................. 22
CHAPTER THREE: METHODOLOGY ............................................. 25
3.0 Introduction ............................................................................. 25
3.3 Model Specification ................................................................... 26
3.4 Data Analysis and Techniques ...................................................... 26
References .................................................................................... 28
CHAPTER ONE
INTRODUCTION
1.1 Background
The evidence of climate change in Kenya is undeniable, while its effects on economic growth are no
more mysterious; rather, they are rapidly unfolding to a startling reality and concern for humanity.
Accelerated emissions of green house gases (GHGs) globally, from combustion of fossil fuels and
unsustainable land use practices is the key driver of anthropogenic climate change, which is
manifested in; temperature variations, frequent and extensive droughts, intensive rainfalls and
floods, seasonal and regional pest and disease prevalence that result to conflicts for pasture and
water resources,
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WhatГs an Emerging Market Economy? Essay
By definition an emerging market economy is one that has a low to middle per capita income
which is in the process of moving from a closed economy to an open market economy. They
currently represent approximately 20% of global economies. Although China is considered to be
one of the largest economies of the world it is still classified as an emerging market due to its
developments and reforms and low capita income per head. In general, emerging markets are deemed
to be fast–growing economies into which developed economies look for new sources of income, and
through their investment the emerging economy's production levels rise thus increasing their GDP.
The four largest emerging economies are Brazil, Russia, India and China, often...show more content...
For India, GDP of 5.4% in 2014 and 6.3% in 2015 with inflation of 7.9% in 2014 falling to 7.5%
in 2015. They do not have any unemployment rates for India. For China, the GDP figure is 7.5% in
2014 and 7.2% in 2015 with inflation of 3% in both 2014 and 2015 whilst unemployment is forecast
to hold steady at 4.1%.
The MINT economies of Mexico Indonesia and Turkey all have stable inflation and public finances
whilst Mexico, Nigeria and Indonesia are in the G20 bloc of developing nations.
Tapering will result in a fall in global dollar liquidity which could damage those emerging market
economies who are heavily reliant on external financing of their current account deficits or those
with domestic weaknesses. This could result in an outflow of foreign capital in the short term which
would push their exchange rates lower and in turn lower the inflationary expectations. This would
subsequently reduce economic activity and could result in a need to raise interest rates to maintain
currency levels, thus causing domestic growth to stall. The countries most at risk of this are the
"fragile five" of Brazil, South Africa, India, Turkey and Indonesia.
Fears of a slow–down in China has also put pressure on emerging market economies. Recent Chinese
PMI data has shown that the economy there continues to contract, albeit at a slower rate. However,
based on the average figure

business economics Essay
Table of Contents 1.INTRODUCTION 2.MAIN BODY 2.1THE NATURE OF RESOURCE COST
STRUCTURE AND THE PRACTICAL SIGNIFICANCE OF DIFFERENT COSTS 2.2THE
FACTORS INFLUENCING OPTIMUM SIZE AND THE SIGNIFICANCE OF DEMAND AND
SUPPLY RELATIONSHIPS 2.3UNDERSTANDING OF THE RELEVANCE AND
LIMITATIONS OF ECONOMIC THEORY TO MANAGE DECISIONS 3.CONCLUSION
1.INTRODUCTION: From the economic perspective, there are a full range of wants from
individuals, firms and government but there is only a few number of resources or factors of
production such as land, labour, capital and enterprise. The raw material will come from land,
taking the example of oil, gas. The labour relates to the individuals able to work. The capital covers
machinery,...show more content...
Equipment, everything used to bring all the materials together, for example, cranes, welding sets,
computing time, mobile offices. It is also important to know how much money committed to spend
at any point in time. 2.1.1The microeconomics perspectives: This focuses on the market behaviour
of individual consumers and firms to help understand the decision making process of firms and
households. This is at a level of individual buyer and individual seller, meaning demand and
supply. How much to produce and how much to charge for it. The law of the demand is that the
demand decreases when the price increases and the demand increases when the price decreases.
Also more demand of a product results in an increase of the price the price of that product. (See
graph below). 2.1.2The macroeconomics perspectives, focuses on the big picture of the national
economy as a whole and provides a basic understanding of how things work in the business
environment. The macrocosmic policy goals will be achieved by the monetary policy and the fiscal
policy. The monetary policy is the management of the nation money supply, the decision of the
interest rate and the banking system to promote economic growth, lower unemployment and
inflation. 2.2The factors influencing optimum size and the significance of demand and supply
relationship: The demand and the supply are two main concepts of the economy. Demand is what
quantity of product or service

The Role of Business in the Economy
The Role of Business in the Economy
Michelle Peters
Milton Lawler, Ph.D.
Business 100 – Introduction to Business
February 22, 2013
Abstract What is the role of business in economic development? Some might say that business is
the lifeblood of any economy. This is because businesses provide benefits to an economy in ways
like job creation, the payment of a good portion of a region's taxes, and the use of local resources.
This cycle continues as the people employed by these businesses contribute to the economy by
spending the money they earn, and the resources needed by a business further contribute to the
economy by providing capital and employment to the vendors of these resources.
Roles of For–Profit and Nonprofit...show more content...
The downside of exporting is that it can become expensive. For example, the cost of international
shipping can become exorbitant. Outsourcing, or contract manufacturing, is yet another way to
break into global markets. This is when a company relocates its manufacturing operations to another
country. In this way a company is able to save money on resources used and employees, which get
paid less. Moving production to a different country also opens up that market to the company. Joint
ventures can also be a way that businesses can expand to international markets. In this scenario, one
business becomes the partner of another, pooling resources like marketing and advertising. When the
two companies are from different countries, this allows them to reach markets globally that might
not have been available to these companies individually (Salvatore, 1993).
As an example, a business is developing a strategy to expand globally with a new type of widget. A
franchising strategy will not work for this type of business. Exporting the product to different global
markets could be a useful strategy, as well as outsourcing the manufacture of the product. In
addition, cheaper resources for the production of the product may be available in some of these
global markets.
Social Responsibility and Business
In order to be socially responsible, businesses must take into account the economic, environmental,
cultural and social issues in their particular

Financial system The term financial system stands for a set of complex and closely connected or
interlined institutions, agents, transactions, liabilities, and claims in the economy. It is related with
money, credit and finance– three terms thought to be related with each other but somewhat
different from each other. It provides a mechanism through which savings can be converted into
investments and it mobilises the surplus funds and utilizes them efficiently and effectively for
productive purposes. It is characterized by the integrated and organised regulated firms that help
in meeting short term and long term financial needs of all the sectors. Therefore it is said that
financial system plays a significant role in economic growth of the country. The financial system
serves as a link between the savers and investors. It helps in utilizing the different savings of
scattered savers in a very effective and efficient manner. It provides mechanism for exchange of
the goods and services. It assists in selection of projects which should be financed and also keeps a
check the performance of such projects. It helps in changing the saving into investments that help
earn some returns. It also provides the market with a mechanism for the transfer of resources across
geographic boundaries and a mechanism for managing and controlling risks involved in saving and
credit. It comprises a set of sub– systems called financial instruments and services, financial
institutions, and financial

Inflation and the Economy Essay
Inflation and the Economy WHY UNDER MONETARY FREEDOM INFLATION COULD BE
STOPPED WITHOUT BRINGING ABOUT UNEMPLOYMENT
1. Unemployment and inflation do coexist and inflation causes much unemployment which would
cease with it.
2. Excessively inflated prices would fall to market prices and so promote sales and employment.
3. Less government spending would mean more private spending. 4. Prices and wages could be
adjusted fast. If this is not done then this is not the effect of stopping inflation!
5. Price adjustments through gold–value clearing could take place already during a continuing paper
money inflation – leaving no adjustment problem.
6. While FALLING prices do indeed deter from buying and promote...show more content...
2. Paying men not to work (unemployment "insurance").
3. Deflationary withdrawal of notes from circulation – while free banking remains suppressed.
4. Replacing the old currency at an arbitrary rate, not the free market rate, and most likely supplying
not enough new currency because under monetary despotism there is no yardstick like the free
market rate for currencies.
5. Continuing monetary despotism with all its uncertainties and the expectation of further inflation.
6. Tax increases and their stricter collection– with their deflationary effects. 7. Delays in spending of
tax–collected funds after the official currency
"reform".
8. Issuance of a new "reformed" currency in quotas only.
9. Insistence on gold payments or gold redemption – regardless of the availability of gold and
existing or possible alternative private contractual arrangements, i.e.: part redemption (revival J.Z.,
1999) of monetary despotism in the form of an exclusive gold standard.
10.Issuance of the new currency only to the extent that foreign loans are available as "backing".
I have no doubt that there are more right ways and that many more mistakes could be listed. This
listing was only made to throw some doubts on unchecked premises, official announcements and
"expert" views on the subject, including

e.g. those of Milton Friedman, F.A. Hayek, Murray Rothbard and Mark Tier.
The essence of my case is contained in the above

Germany and its Economy Essays
Germany and its Economy
Known as the "fair" capital, Germany lies in the center of Europe and in the center of the European
home market. Approximately two thirds of the top international fairs take place in Germany.
Germany is successful. A leader in world trade, Germany is the third largest economy in the world
and the biggest market in Europe. It wasn't always this way though; European power struggles
wounded the country in two devastating World Wars in the first half of the 20th century and left the
country dominated by the victorious Allied powers of the
US, UK, France, and the Soviet Union in 1945.
Germany has been through all of the phases of the business cycle many times. It even suffered
immense depression after...show more content...
In addition to this, an attempt is made to prevent restraints on competition resulting from monopolies
and cartels. Since Germany is a market economy, the three economic questions are answered almost
the same was as we in the
United Statesanswer them. The consumers of Germany answer the three economic questions by
what they buy and don't buy.
Given that Germany is known as a large exporting nation, many kinds of goods are produced there.
A large amount of what they export is made up of vehicles, chemicals, machinery, metals &
manufactures, foodstuffs and textiles. They also have a large agricultural industry with products
such as potatoes, wheat, barley, sugar beets, fruit, cabbages, cattle, pigs and poultry. Germany is
also among the world's largest and most technologically advanced produces of iron, steel, coal,
cement, chemicals, machinery, vehicles, machine tools, electronics, food and beverages. They make
an estimated 506 billion dollars every year in exports and spend 472 billion on imports. The current
inflation rate in Germany is around 2.4% and the unemployment rate is 9.4%. Income is measured
as the value of an economy's gross domestic product divided by its population. The purchasing
power parity was an estimated 2.2 trillion dollars with parity per capita of
$26, 200; the growth rate of GDP was 3% from 2000 to

The Global Economy Essay
The global economy is a complex and multi–faceted system. When one variable changes, such as a
dramatic increase in the New Zealand dollar, the spin–off effects can be detrimental to some while
increasing the wealth and living–standard of others. This essay will discuss the global economic
system we have in place today, and the consequential distributive injustices as a result of this
structure. These perceived injustices arise as a result of the ethical debate of reducing poverty via
economic growth versus creating a sustainable environment.
The origin of the capitalist economy we have today can be linked back to the industrial revolution
between the 1750s–1850s. As the economy began to display signs of rapid growth, global population
...show more content...
The idea of the capitalist market is in contrast with that of the socialist market. The aforementioned is
characterised by private business ownership, free entry into the market, profit as the ultimate goal,
consumer choice and the government acting as a type of economic regulator. A socialist market is
more typical of a government–planned economy where distribution of income and wealth is the key
to obtaining social gain. The Washington Consensus is a set of policy based themes its author, John
Williamson, believed necessary for the recovery of Latin America after the financial crisis of the
80s. Williamson provides a set of capitalist ideas which the IMF, World Bank and US Treasury
Department use when setting policies (Williamson, 2002). The Washington Consensus is proof that,
for the most part, the economy is still in a capitalist form. However, recently there has been a huge
push by socialist economies such as China and Russia as they become increasingly powerful in an
economic sense, although in a way they are also becoming increasingly westernised. The problem is
evenly distributing the world's resources when increasing amounts of people want more than they
actually need. Socialist state economic systems but with Americanised consumerism is setting the
scene for an interesting start to the 21st century.
The changing economic landscape comes at the heels of an ever–expanding and expending Chinese
economy – an

Economy Essays
Believe it or not, but, your everyday life is effected by the economy. I'm sure each person goes to
the mall, and to the shoe store. Well, let's say you just heard about these awesome sneakers, and
almost everyone you know wants a pair. You go into the shoe store to find them, and they are all
sold out! You have just been affected by the SUPPLY of a product. The more people want
something, they higher the price will be. Then, you figure you will wait for a while, until the price
of those sneakers goes down, but, they are THE most popular sneakers ever made. Guess what, the
next time you go to the store, the price has actually gone up! Because EVERYONE seems to want a
pair of these things. The company now figures that the sneakers will be...show more content...
"Needs" and "Wants" are completely different terms. People HAVE to buy the things that they need,
but do not necessarily HAVE to buy the things that they want. Things like clothing, food and housing
are things that we need, but, we can live without such things as the latest sneakers, or video games.
Each persons' needs and wants are somewhat determined by their own personal economic situation.
If a person is independently wealthy, they can buy whatever they wish, but most people have to deal
with a certain amount of money. They cannot spend whatever they wish.
Our country right now is at an all time high for spending, despite some of the happenings on
September 11th. This is not necessarily a good thing. You have heard the old saying, "a penny
saved is a penny earned", well that is exactly what people are now saving. One penny is now
being saved for every $10 worth of income. Our country has one of the lowest savings rates of any
industrialized country in the world. When we retire, we will have to live on things like social
security. As you may have heard from all the election promises, the candidates are telling everyone
they will help the elderly people with their medicine costs. These people probably did not have the
chance to save. Savings is an important thing in our country. It is also carefully watched by the
Federal Reserve Bank. Alan Greenspan, is the head or chairman of the Federal

Macroeconomic Outlook of U.S. Economy Essay
Investment Analysis Macroeconomic outlook of U.S. economy For every four to six years U.S
economy faces an economic slowdown. Thus the current market is now in forth year. The root of
U.S. crisis and its economy can be traced backed to 2007, when U.S housing bubble burst which
yields a financial meltdown in 2008. In average, the American trying to make ends meet in 2014, a
market and a recession will probably look and feel the same. In early 2008, when the financial
crisis began, then the U.S. national debt stood at $9.2 trillion. Figures figure out by the White
House, the national debt will reach $20.0 trillion by the end of decade about 140% of our current
GDP. Successful debt reduction requires fiscal constraint and policies that...show more content...
The positive gains will come strongly as business and customer's confidence reinforce, when the
overseas sales increases and the Europe begins to emerge from the prolong snooze. And the
manufacturing purchasing index activity reports will show the strong expanding output.
Furthermore, there is a decent chance of an upside surprise to 2014 growth. Rational investor's
investments, spending and confidence are still below than the expected level what would be
considered normal levels by the standards of past economic expansions. As the job growth
becomes strong and consumers feel more protected then a righteous way of spending is getting
better, more consumer income begetting more spending could be initiated. If this occurs rapidly
then the quarterly growth is likely to exceed an annually at the rate of 3%. But if this does not
happens in 2014 than it is nevertheless very likely to happen before the end of 2015. (Payne, 2014)
Unemployment In March 2014, the encouraging thing was that the unemployment rate held at
6.7%. Even though a lot of individuals entered the labor force who power up the participation rate
to 63.2% which explicitly means that the number of unemployed people did not raise so much. But
the rate is expected to gradually drop to 6.3% by the end of the year. In March, although the initial
reports on weather effects in January and February nevertheless played a role in dampening job
growth in those

Economic Growth Essay
Economic Growth Economic growth refers to the rate of increase in the total production of goods
and services within an economy. Economic growth increases the productivity capacity of an
economy, thereby allowing more wants to be satisfied. A growing economy increases employment
opportunities, stimulates business enterprise and innovation. A sustained economic growth is
fundamental to any nation wishing to raise its standard of living and provide a greater well being
for all. Gross domestic product (GDP) is the monetary value of all final goods and services produced
over a year. It is the total value of production within the economy. The total value of production is
the total value of the final goods or services less the cost of...show more content...
Real GDP is measured by the following formula; [(current year quantity) x (based year price)]. A
more reliable measure of economic growth is real GDP per capita; this measurement takes into
account both the total production of the nation and the total population. Real GDP per capita
measures the real income per head of the population.
This can be measured by the following formula; Per capita nominal GDP = Nominal GDP
/ Population, Per capita real GDP = Real GDP / Population. Seven factors determine economic
growth. Natural resources such as land, mineral deposits, waterways; climatic conditions provide an
essential foundation to economic growth. Combined with the other resources of capital, labor and
enterprises, natural resources can be developed and organized to increase the productive capacity if
the nation. Consequently the quality and size of the labor force is a major determinant of economic
growth. Education and vocational training are essential the growth potential of a nation. The
promotion of education and job training schemes increase the knowledge, skills and flexibility of the
workforce that contributes to potentially higher levels of productivity and efficiency. Whether from
natural increase or immigration population growth can cause a higher level of economic growth. An
increasing population requires increased public spending on housing, education and other social
needs while businesses expectations of

Essay about U.S. Economy
The United States economy is currently not looking very good. Over the past couple of months
the economy has taken a turn for the worst and we could be headed into a recession in the coming
months or years. The biggest problems are in the real estate and mortgage markets. In 1999,
housing prices rose at huge rates and lenders began offering riskier mortgages, which caused
homeowners to keep piling up huge debts. People were taking out loans and balloon mortgage
payments that they really could not afford. The problem began in late 2007, when housing prices
began to fall and the system fell apart causing huge numbers of defaults on home loans and
foreclosures. Currently, 5.6% of mortgages are delinquent, the highest rate in 21 years, and...show
more content...
The housing crisis that I mentioned earlier and resulting backlash through the entire economy has
been building for awhile now but it has just came into the forefront in the past couple of weeks.
We really haven't faced a downturn like this since the Depression. Last Tuesday, January 22, the
Dow Jones industrial average fell almost 600 points and was already down 9% in 2008 (Gross 1).
Immediately the Federal Reserve took action and cut the interest rates three–quarters of a percentage
point, the biggest cut in 24 years. Today, not even a week later, the Fed again cut interest rates, this
time by a half–point (Aversa 1). This move is an effort to keep the economy out of a recession by
getting money back into the banks and encouraging them to keep lending credit to turn the
economy upward. Whether or not it will work remains to be seen in the coming months. The
government also announced another move to a couple weeks ago to help get the economy going
again and avoid or slow down a recession. President Bush and the House are currently developing a
$145 billion stimulus plan that would give tax relief to citizens by sending them individual checks
for $300 and up. The plan would put over $100 billion into the hands of consumers and the
government hopes that money would be spent and put back into the economy (Wolf 1). While all
these things are good news for the struggling economy, most economic experts believe that a
recession of some kind may be impossible to avoid

Essay On The Economy
Will the economy in America overheat in 2018?
The labor market is at its healthiest level in over a decade, however, inflation is still low
Politicians usually pretend not to be surprised when there is good economic news when they are in
office. However, the recent growth numbers in America were so positive that even President Trump's
administration allowed itself to bask in this good news. White House budget chief Mick Mulvaney
stated in September that the growth is taking place much quicker than anticipated; this was
following the 3.1% growth in Q2. (Mr. Trump promised 4% growth during his campaign, however
that goal seems to have shifted to 3%.) Mr. Mulvaney stated that hurricanes might negatively impact
the growth. But in Q3 it...show more content...
There are three more increases in the rates predicted by the Fed's rate–setting committee for 2018.
All rate–setters believe that the current low rate of unemployment is not sustainable, but somehow
they all forecast that the unemployment rate will drop even further in 2018.
There is no need for The Fed to panic. Irrespective of what President Trump says, the experience
forecasters are all saying the same thing; the rate of growth is closer to 2% than 3% due to the
country's aging population. The economy has created 170,000 jobs monthly on average over the past
three months. But for the rest of the decade up until 2026, the 20–64 year old demographic will only
grow by less than 50,000 monthly according to official projections. It is impossible for joblessness
to fall indefinitely, therefore if productivity doesn't pick up, growth will decline. If the Feds gets too
slack with money, inflation will increase eventually when the economy overheats.
Households appear to be very happy. According to a consumer–sentiment index, done by the
University of Michigan in October, was at its highest level since 2004. The latest consumption
growth has been driven by a sharp decline in household saving, which happened to be 6% of GDP
2 year ago and is today down to only 3.2%. Some analysts complained in 2016 that consumers were
hiding away the money they saved on cheap gas and as a result, the economy was denied a
much–needed boost. But today, the opposite seems to be true:

Free Market Economy Essay
A free market is a type of market that the government is not involved in. Since the government does
not care about what happens, the free market is also called "hands–off" or "let it be economics". The
government is limited to protect the citizens from the danger and that is the major goal for the
government. In the free market economy, there are three components of the free market economy:
competition, active but limited government, and the self–interest. Competition is one of the main
components of the free market economy. Competition means that the companies compete with one
another to make more benefits to themselves. According to the concept of the free market economy,
the competition means a good thing because it is a basic...show more content...
The government does not necessarily need to intervene how the marker goes. Therefore, the
competition is a significant factor of the free marker economy.Active but limited government is
another main part of the free market economy. This means that the government undertakes a
significant, active role in the market, but at the same time the government's role is ver limited
because all the investments and decisions in the economy are controlled by the market than by the
government. An invisible hand will control the market. Limited government is a type of government
in which there is a minimum intervention in personal properties. Overall, the government tries to
keep the economy in a law and let it free by limiting itself. Hence, the limited government is an
essential factor of the free market economy.Last, self–interest is a significant part of the free market
economy. Self–interest refers to one's desire to buy something. The market will be generally
controlled by people's interest; the companies will compete with one another to fit the best taste.
This is because the people's interest will be the main trend in the market and it will control what
should be made in the market. Consequently, the market will be self–regulated according to the
theory of a free market. Therefore, the self–interest is another significant factor of the free market
economy.Therefore, the competition, the

Economic Systems Essay
Introduction
Economic systems are organized way in which a state or nation allocates its resources and
apportions goods and services in the national community. An economic system is slackly defined as
country's plan for its services, goods produced, and the exact way in which its economic plan is
carried out. There are three types of economic systems exist, they are command economy, market
economy, and mixed economy. Command economy is also sometimes calledplanned economy. The
expectations of this type of economy is that all major decisions that related to the construction or
production, distribution, commodity and service prices are all made by the government. However,
in market economy, national and state governments play a...show more content...
Businesses can decide which goods to produce and in what quantity and consumers can decide
what they want to purchase and at what price. The role of the state is limited to ensure right
precision in the prices charged by the sellers. Prices also have the function to allocate and
distribute a country's resources. Market leads to complete effectiveness bringing about the best
possible distribution of a country's resources in a perfect world. This would only happen in a
state of equilibrium and there is a unique price for every commodity. But in a realistic world
which is imperfect by nature, prices are never at equilibrium and very unstable depending upon
the vagaries of the market forces. This generally harms people living below the poverty line. It is
impossible for them to pay high prices in cases of demand shortage. Thus, the free market model
is not a viable option in developing countries which has a large number of poor. Besides, producers
are aim to minimize profit and maximize rent of production. Examples of countries that are using
this economy system are Hong Kong, USA, and UK. Many developing countries like India and
China are moving towards totally free–market economy. The command economy is government
directed. The market forces have very little say in such an economy. There is no private property.
On the other hand, a command economy aims at using all available resources for developing either

State of Economy Essay
An economy, as defined by the Webster Dictionary, is the wealth and resources of a country or
region, in terms of the production and consumption of goods and services. An economy, as
defined by the vernacular, is a word that has become linked with synonyms that invoke feelings of
dread, depression, collapse, and flat out anarchy at best. Both close to home and globally, people
have felt some effect of the market crash. Since 2007, millions of Americans lost their homes, jobs,
and feelings of financial security. To even begin to think about possible solutions to the current state
of the economy, one must first understand the origin of our problems. We are in a recession today
because of a weak job market, risky mortgages, and a heavy...show more content...
The demand for houses, along with a belief that home values would continually soar, fueled the
building boom that would eventually result in our demise. Once the grace period on mortgage loans
ended, and house prices began to decline, many people found themselves unable to escape the high
monthly payments and began to default. Increasing foreclosures continued to lower the prices of
homes, by 2008 it was estimated that 23% of all homes were worth less than their mortgages. 2.9
million vacant homes later, it is safe to say the consequences of short–sighted expenditures were
severe. Since then, more than 6 million Americans have lost their homes to foreclosure. Much of the
blame for the housing crisis can be traced back to rumor in the stock market. While homes are not
typically viewed as investments under speculation, statistics show that this was not the case during
the mortgage crisis. 22% of homes purchased in 2006 were for investment purposes. The housing
market was just one of a few key components miscalculated by David Li's Investment formula. It was
always seen as impossible to map the risk of uncertainties under investments; at least until the
Gaussian copula function was formed. The formula was created to remove the guesswork from
investing – it would be like gambling without risk of ever losing. Prior to the Gaussian formula, the
market had $920 Billion U.S. dollars invested in credit

Impact Of Globalization On The Economy Essay
Impact of Globalization on the Economy Social and Environment
Introduction
Economic globalization is the process of connecting economic activities of nations and regions to
accommodate intercontinental trade. Goods and services can be easily moved across borders guided
by international policies. International investors are encouraged to invest in other countries by either
opening new businesses or branching out. Also, the importation and exportation of goods and
services are allowed while job seekers can venture beyond their border for better employment.
Sustainability is achieved when the needs of the present generation are met while at the same time
preserving enough resources for the future generations. This paper assesses the impact of
globalization in the world today in order to find out whether the trend is sustainable for the current
generation and the future generation.
Developed countries are associated with well–structured economic sector driven by cheap power. For
economic prosperity to be realized, the human resource should be well educated and skilled to run the
economy. Equally important, political stability provides a conducive environment for investments to
grow. In most cases movement of goods and services cannot move freely in an unstable environment.
Unlike developed countries, developing countries are associated with political instability, corruption
and poorly educated population. Also, such countries have poorly developed infrastructure that

U.K. Economy Essay
U.K. Economy
The UK government currently has four main macroeconomic aims that it is pursuing. These aims
are those of low unemployment, low inflation, and high and stable economic growth as well as a
favourable balance of payments current account position. This essay will concentrate on the
government's success in the first three of its aims listed above and how these macroeconomic aims
can or have been achieved using fiscal and monetary policy. Fiscal policy is used to affect aggregate
demand by altering taxation and government spending; monetary policy also affects aggregate
demand by the manipulation of interest rates and the supply of money.
Economic growth is the prime measurement of a country's economy as it...show more content...
Indeed, inflation since 1990 has remained remarkably stable by UK standards, however in February
2003 the RPI rose to 3.2%, mainly due to clothing and petrol prices going up.
Monetary policy has allowed the UK to enjoy low levels of inflation for a number of years now, in
particular since the 1990's. This can be seen in the diagram below, where the Bank of England have
been able to meet the 2.5% target (+ or – 0.5%) through the skilful use of interest rates. Generally, if
inflationary pressures on the economy are high, the MPC reacts by increasing interest rates.
This increase in interest rates causes a fall in aggregate demand from
AD1 to AD2 and thus a fall in inflation from P1 to P2 via the following transmission mechanisms.
Consumption, a component of aggregate demand (consumption + investment + government
spending +
(exports–imports)) falls as the cost of credit increases due to more interest having to be repaid and
thus big ticket credit purchases become relatively more expensive, as the opportunity cost of
spending increases (as more interest is forgone) and as the effective disposable income of consumers
on variable rate mortgages falls.
Furthermore, investment falls as firms are less willing to obtain more expensive credit through
borrowing and more likely to

Macroeconomics Essay
"Macroeconomics is a branch of economics that deals with the performance, structure, and behavior
of a national economy as a whole. Macroeconomists seek to understand the determinants of
aggregate trends in an economy with particular focus on national income, unemployment, inflation,
investment, and international trade" (Wikipedia, 2007). Government tends to use a combination of
both monetary and fiscal options when setting policies that deal with the Macroeconomic.
According to McConnell & Brue (2004), governments make adjustments through policy changes
which they...show more content...
dollars into gold at $35 per ounce, has made the U.S. and other countries' monies into fiat
money–money that national monetary authorities have the power to issue without legal constraints.
Money is used in all economic operations; money has a powerful effect every economic activity. The
increase in supply of money put more money in the hands of the consumers and increased spending.
When the money supply continues to expand and the prices begin to increase, particularly if the
output growth reach to the capacity limits as the public begin to expect the inflation, lenders insist on
higher interest rates to offset and expected decline in purchasing power over the life of their loans.
Contradictory results happen when the supply of money falls, or when the rate of growth cries off.
The U.S. money supply comprises currency–dollar bills and coins issued by the Federal Reserve
System and the Treasury–and various kinds of deposits held by the public at commercial banks and
other depository institutions such as savings and loans and credit unions. On June 30, 1990, the
money supply, measured as the sum of currency and checking account deposits, totaled $809 billion.
Including some types of savings deposits, the money supply totaled $3,272 billion. And even broader
measure totaled $4,066 billion

What is Economics? Essay
Many people think that economics is about money. Well, to some extent this is true. Economics has
a lot to do with money: with how much money people are paid; how much they spend: what it costs
to buy various items; how much money firms earn; how much money there is in total in the
economy. But despite the large number of areas in which our lives are concerned with money,
economics is more than just the study of money.
It is concerned with:
В·The production of goods and services: how much the economy produces; what particular
combination of goods and services; how much each firm produces; what techniques of production
they use; how many people they employ.
В·The consumption of goods and services: how much the population as a...show more content...
There are three types of resources:
В·Human resources: labour The labour force is limited both in number and in skills.
В·Natural resources: land and raw materials The world's land area is limited, as are its raw materials.
В·Manufactures resources: capital
All inputs into production that have themselves been produced: e.g. factories, machines and tools.
One must bear in mind that our wants are virtually unlimited, while the resources available to
satisfy these wants are limited. In other words when society demands more of a product than can
actually be produced to fulfil those wants we have a problem of scarcity. An example of this would
be the OPEC oil price shocks between 1973 and 1980. Yes, it is true that the price of oil rose and
some individuals used substitutes but the economies of oil importing countries like Germany and
Japan fell because OPEC now had more buying power since they had the control over a scarce
resource. We can therefore think of oil as having become scarcer in economic terms when its price
rose.
Earlier I stated that economics is concerned with consumption and production. We can look at it in
the terms of demand and supply. It is simply the quantity of a good buyers wish to purchase at each
conceivable price. Three factors determine demand:
В·Desire
В·Willingness to pay

В·Ability to pay
Whilst supply is the quantity of good sellers wish to sell at each conceivable price. Supply is

Economy Essay

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