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Economics Essay Topics & Paper Examples

War Is Good or Bad for the Economics

Consider the following in your answer: 1. What are the advantages and disadvantages of various methods of war financing? 2. What are the “costs” imposed on the economy by engaging in war? 3. Provide an example from US History; analyze the effects on economic institutions in the long run after a war. 1. In war, there are various economic benefits. First, all economic resources are being used, both goods and services. The unemployment rate hits the floor and there are goods being manufactured faster and more. Thus, this boosts GDP and increases the AS curve, due to the mass production of the goods. There may be the disadvantages of too small of a workforce, or after the war is done,…

Shareholder Wealth Maximization Model

Shareholder wealth-maximazation model goals to maximize the present value of the expected future cash flow for the equity owner’s (shareholder). It is the long term business goal and the value for the firm is determined by the amount, timing, and risk of the firm’s expected future profits. For the following events, the value of the firm is : a. New foreign competitors enter the market The size of market will become large and a lot of companies can supply the goods. There will be no monopoly market and to maintain the profit, firm should reduce the quantity with the same price. But the present value of profit will decrease because total of revenue decrease and automatically reduce the shareholder wealth…

An Alternative Theory of Economics

Economics is usually defined as the problem of how best to distribute limited resources, limited because wants are characterised as unlimited, but common sense tells us that rather than limited resources, there is an abundance of resources. The difference is one of perspective and this is core to any alternative understanding of economics. If wants are the focus, then of course resources are limited by definition, but if minimum needs or essentials are used as the foundation, then resources are seen to be abundant. The difference is between a description and an explanation. A focus on wants or desires describes a market situation, while a focus on essentials or needs allows an explanation of choices to begin. It is necessary…

Macroeconomics Tutorial Test

Question 1. (i) Identify and briefly explain the main features of the business cycle. (2 marks) Business cycles are usually characterized by periods of transition from peak to trough and then from trough to peak. The peak of a business cycle is the high point of GDP prior to a downturn whereas a Trough is the low point economic activity prior to a recovery. The period in which the economy is moving from a peak to a trough is called a contraction and the period in which the economy is moving from a trough to peak is an Expansion. (ii) Explain the concepts of (a) potential output and (b) the output gap. (3 marks) Potential Output (y*) or full employment…

Demand Curve and Supply Curve

Demand and supply have been generalized to explain macroeconomic variables in a market economy. The Aggregate Demand-Aggregate Supply model is the most direct application of supply and demand to macroeconomics. Compared to microeconomic uses of demand and supply, different theoretical considerations apply to such macroeconomic counterparts as aggregate demand and aggregate supply. The AD-AS or Aggregate Demand-Aggregate Supply model is a macroeconomic model that explains price level and output through the relationship of aggregate demand and aggregate supply. It is based on the theory of John Maynard Keynes presented in his work “The General Theory of Employment, Interest, and Money”. It is one of the primary simplified representations in the modern field of macroeconomics and is used by a broad…

Reading Reflection

Question 1. What does Heilbroner mean by the ‘economic problem’ and how does ‘tradition’, ‘command’ and ‘the market’ “solve” it? Why does Heilbroner think ‘economics’ is of no use for studying pre-market economies? (chapter 1). In the first chapter of this book, the author illustrated several concepts. Firstly, ‘economic problem’ was defined as “extraordinary variety of ways in which human communities have wrestled with” (Heilbroner, p.9). Secondly, ‘tradition’ solved the economic problem by customers. For example, a son will do his fathers’ job and run in the family. Thirdly, the ‘Command’ solved the problem by order form above. “It requires an enforcement mechanism different from internalized pressure of socialization” (Heilbroner, p.12). Lastly, the market solved the problem by the system…

Essay Invisible Hand

The invisible hand is a metaphor coined by the economist Adam Smith. Once in “The Wealth of Nations” and other writings, Smith demonstrated that, in a free market, an individual pursuing his own self-interest tends to also promote the good of his community as a whole through a principle that he called “the invisible hand”. He argued that each individual maximizing revenue for himself maximizes the total revenue of society as a whole, as this is identical with the sum total of individual revenues. Smith used the term ‘invisible hand’ only three times, but the metaphor later gained widespread use Several new interpretations of Adam Smith’s invisible hand have recently been published in leading general-interest economic journals. These interpretations attempt…

Economics and Swot Analysis

Before we start with the swot analysis of IBM lets understand what actually the SWOT is . The full form of SWOT is strength ,weakness opportunity and threat . so the basic meaning of swot analysis of any company is to judge this four factors of any company at certain given period of time . On the other hand the full form of PEST is Political, Economic, Social and Technological and the analysis of these four factors of any organization is called pest analysis. SWOT ANALYSIS : Strengths: 1. Founded in 1896 as the Tabulating Machine Company by Herman Hollerith, in Broome County, New York it is very much old and organization of high repute . 2. the leading IT…

The Importance of Academics in Education

The vital skills in academia are crucial for personal and professional development; they can contribute to the economic growth of a country, building meaningful human capital by providing more people-friendly policies, investment in educational opportunities which can result in the production of more skilled workers. The more skilled a society is, the less prone it is to poverty, a more even distribution in households as well as increases in governmental incomes making the economy more sustainable. According to Phillip Brown et al (1997, p. 172) “the quality of a nation’s education and training system is seen to hold the key to future economic prosperity”. Education, Culture, Economy and Society by A. H. Halsey, Hugh Lauder, Philip Brown and Amy Stuart…

Growth of independent grocers during challenging economic times

The recent economic hardship had impact on many economic activities that led to freezing of credit markets, economic benchmarks plummet, imploding of financial institutions, closure of business entities and consumer spending plunges. Closure of organizations and business entities led to increased levels of unemployment since many employees lost their jobs (Stefanou Spiro, 1993). Consumer spending habits changed due to changes in earning ratio and operating on tight budgets. Small businesses such as independent grocery are affected by challenging economic times. Prices of commodities skyrocketed and this had an impact in ales volume by independent grocers. Businesses such as independent grocers braced a hard time but the fact that individual are entitled to basic needs such as food was the most…

Human Capital, Inequality and Growth in Transition Economies

Human Capital can be defined as the accumulation of competences and knowledge in individuals gained through education and experience, not forgetting their personality attributes. All these put together enable individuals effectivley perform profitable and revenue generating economic activities. Such competent persons in a society are at times reffered to as a workforce or laborforce. Some examples of investments in humans that result in human capital are education, health and training. As Becker says, human capital investments raise the earning ability of individuals, improve health and add to an individuals’ good habits. The term inequality generally refers to disparities in access to opportunities or resources amongst individuals, groups or even countries. Some of the common causes of inequality are; gender, race,…

Villagers remain upbeat despite tight cutbacks

Orange County – There was absolutely nothing left to do, 39 year-old Mr. Berger, an office clerk, decided to sell his latest model of LED television he just purchased the other year to a well-off friend, the economic crisis steeply increasing his weekly budget deficit. “I believe its the high spending we do everyday amid threats from financial meltdown that’s taking its toll on us lately,” Mr. Berger said. It is no small irony that while unemployment rate has blown only 9. 5% of the population today against the 10% in the first quarter this year, the figure could not justify how some of the residents continue to lose their jobs. What may add insult to injury is the sharp…

How is our current Economic growth compared to 30 years ago

The year 1979 saw both external and internal conditions become difficult owing to rising inflation with end user prices increasing by 13%. The years 1979 to 1981 saw the US experience a double-digit price increase owing to global petroleum price increases, federal financial policies, plus the spending patterns of the government. The United States economic system started to take a descending trend. In order to manage such financial troubles, the administration of jimmy carter squeezed the national financial plans and implemented financial restraint (United nations, 2008). The administration as well declared short plus long-term energy regulations and attempted to control the financial climate. By mid 1900s, the US was a key end user of almost each significant industrial unprocessed material….

How War Affects the Economy

Countries that have experienced periods of war have had their economies mostly affected negatively. Considering war and the economic history, it is evidence that war has influenced the economic history across the world for centuries. This influence is both negative and positive. In most cases, those who win during wars have ended up getting their economic institutions and trade patterns in shape. Wars have also led to technological development, increased workforce among others (Goldstein, par. 1). However, the negative impacts of war outweigh the positive impact in terms of waste of money and resources on war, destruction of human capital, trade, resources available and labor management. Wars have also led to loss of many lives thus reducing the population which…

How Tax Cuts can revive the Economy

Tax cuts have been employed in the government’s fiscal policy especially during times of economic slowdown to revive the economy. When the economy is slumping, the people’s consumption power also slumps. The aggregate demand for goods and services in the market also falls. This creates a shock wave which hits industries like manufacturing, the housing sector and the service industry hard, leading to rising levels of unemployment (Toomey & Soloveichik 2009). At such a time, a cut in taxes becomes one of the mechanisms available for pumping some life into the economy. Tax cuts for economic revival target especially people in the lower and middle classes. When implemented, tax cuts increase the amount of disposable income, that is, income after…

The target market

Three different research methods Surveys (Primary) Mail surveys are a relatively inexpensive way to reach a broad audience. They’re much cheaper than in-person and phone surveys, but they only generate response rates of 3 percent to 15 percent. Despite the low return, mail surveys remain a cost-effective choice for small businesses. Which would be a very good method for my business, as my business is still small. Sample: Field trials (Primary) Placing a new product in selected stores to test customer response under real-life selling conditions can help me make headphones modifications, adjust prices, or improve packaging. Small business owners, like me should try to establish rapport with local store owners and Web sites that can help me test my…

History of Economic Thought

(1) In the article of Allen et al. “The Foundations of Free Enterprise,” the three types of economic system were discussed. In a traditional economic system, the allocation of resources is based on social customs, culture, and to some extent, religious traditions. The distribution of the fruits of production is dictated by traditional criteria such as age, sex, and other individual qualities that are not essentially related to personal productivity. Primitive, agrarian, and less-developed societies mostly fall on this category. Many traditional economies progressed into a market economic system, wherein the allocation of resources is controlled by private individuals and businesses. The individuals make independent decisions that reflect their best interest, affecting the market demand, product supply, the price of…

History of Economics

Economics is the constituent of social sciences which studies the economy and its elements. The main elements of economics are production, distribution, and the consumption of certain goods and services. And its main objective is to allocate the scarce resources effectively and efficiently. Scarcity refers to the economic concept that reflects that the resources are insufficient to full fill the wants and needs of all the people. In this paper the concepts of surplus and its effects on the economy would be discussed. Surplus is the situation in which an excess of something is achieved. For example the value or the amount provided after the requirement for something is satisfied or the remainder of particular thing after the purpose is…

Impact of Public Debt on the Economic Growth

Government debt is also known as public debt. It is the debt owed by a federal government to the internal or external sources. It is required when the stocks of government securities are insufficient to cover previous budget deficits. Budget deficits occur when the level of government expenditures exceeds its revenues. Based on macroeconomic theory, the level of government expenditure must be positive with the economic growth. The higher the expenditure, the higher will be the economic growth. Government expenditure can be divided into productive and unproductive expenditure. Productive expenditure will be contributed to the economic growth in a few years’ time. Meanwhile, the unproductive expenditure will lead to the decline in the economic growth. Productive expenditure comprise of education…

Expectations of Current Economy

The U. S. economy in 2013 has a projected growth increased to an annual rate of 2. 5 percent in the first quarter, but not enough to meet the expectations made by the economists (Aljazeera 2013). The reason why all of these projections came to be was because of disappointments that came about; plans did not follow through, or because of accident and uncontrollable events. For example, part of the acceleration in activity reflected farmers filling up silos after a drought in the summer decimated their crops output, but the growth rate was a halfhearted 1. percent (Aljazeera 2013). Because of this event that transpired, the economy did need to compensate in other areas for this event not to be…

Economics, Effects of Specialization

Specialization basically means when an individual or businesses produce a narrow range of products in simple words, when a person or business focuses on producing one type of product because they are good in producing that product. International exchange allows for specialization, which is when one producer produces the good that comes at the least cost of production and opportunity to him or her and then trades for those goods that come at a higher production or opportunity to him or her. The law of comparative advantage explains how people can gain from trade and specialization. Comparative advantage is defined as the ability to produce a good at a lower opportunity cost than others can produce it. Therefore, specializing gives…

The Trend of Logistics Development in China

With China’s entering WTO and the coming of the economic globalization, modern logistics has stepped into a far increased stage. In 2003, the logistics in China occupied RMB 240 billion dollars, compared with that in 2002, which increased by 26%, it is also estimated that during 2000 – 2005 the increasing rate of the 3PL marketing will reach 25% in China. Logistics industry, which is related to the producing manufacturing industry and commodity circulation industry, not only can help the enterprises optimize the resource configuration, lower the product costs, but also improve their competition capability. Logistics is also a systematic project that includes manufacturing, purchasing, storage, transportation, forward, distribution and sale. Now days, logistics and the supply chain management is…

Types of Market Competition

When we examine the types of business structures we are looking at the competition in the market that the business operates within. There are four types of market based on the competition: 1. Monopoly 2. Oligopoly 3. Monopolistic Competition 4. Perfect Competition A firm can be called a monopoly if they are the sole supplier to a market place or its market share is more than 25%. Monopolies are capable of influencing the whole market regarding influencing the price or deciding on the quantity that is supplied. They don`t have to worry about competition. They can set the price and let demand follow the price. They also work hard to prevent a rise in competition. Examples of worldwide monopolies are Microsoft,…

Current Event on India

India is seeking information from China as to why their balance of trade is so skewed. China has been exporting to India far more than it has been importing. This scenario has been reflected globally, with many countries wondering why China has reduced their imports so much. China has also put a ban on Indian Iron Ore, their main export, causing more tension between the new countries. China professes to be increasing their trade annually, pulling them out of the worldwide recession, but many economists and financial experts, including some within China itself, are skeptical as to the legitimacy of these statements. This article relates to our international economics unit that we just completed. China has put a ban on…

There Is No Such Thing as a Job for Life

This notion seems to pose as a self evident statement, but in reality it has become a common truth a couple of decades ago. Statements such as “One in three workers remain in a job for less than two years…” (Trapp, 1995) make their way to the public at a constant rate increasing its validity. In the following essay we are going to assess the basic historical changes that have led to an unstable and fluctuating job market while providing the necessary explanation concerning the effects that shape our current situation. Furthermore we are going to examine how globalisation acts as a catalyst to these circumstances. In order to address this issue we have to take into consideration the historical…

Regional Economic Cooperation

One of the most important developments in the world trade system in the 1990s has been the emergence of regional cooperation. The end of the Cold War reduced political tensions between countries in Asia as well as globalizing production processes and increasing vertical integration. Cities like Bangkok, Kuala Lumpur, and Singapore have been lifting their populations out of poverty in part through cooperative arrangements with neighboring countries. Transnational economic zones have utilized the different endowments of the various countries of East Asia, exploiting cooperative trade and development opportunities. Transfer of technology and manufacturing between nations has allowed them to develop sequentially. Information technology has improved linkages between economies and put remote regions in contact with the world. The private sector…

Market Competitiveness

Market competitiveness is the competitive edge an organization has over another. This competitive edge can range from employee salaries, growth, stock, and employee benefits. Competitive markets are good for companies to stay in business and to keep up with its competitors. Companies have to rationally establish a competitive edge by what the company can offer to exceed its competitors’ offers. This rationale usually comes from the company’s financial resources and if a company lacks financial resources the company has to develop alternatives. Each employee needs will be different and will look for many different things when looking for a job or career. There are hierarchies of employee needs that helps determine if the company will be a good fit for…

Balanced Scorecard

The balance scorecard is used as a strategic planning and a management technique. It is widely used in many organizations, regardless of their scale, to align the organization’s performance to its vision and objectives. The scorecard is also used as a tool which improves the communication and feedback process between the employees and management, and to monitor performance of the organizational objectives. There are four different perspectives of balance scorecard which are financial performance, customer knowledge, internal business processes, and learning and growth. Each perspective represents a different aspect of the business organization in order to operate at optimal capacity. Financial perspective is about how does the firm look to shareholders. This is concerned with the shareholders view of performance….

Pestle Factors

PESTEL analysis stands for “Political, Economic, Social, and Technological, Environmental and Legal analysis”. It is a part of the external analysis when conducting a strategic analysis or doing market research and gives a certain overview of the different macro-environmental factors that the company has to take into consideration. Political factors or how and to what degree a government intervenes in the economy. Specifically, political factors include areas such as tax policy, labor law, environmental law, trade restrictions, tariffs, and political stability. Political factors may also include goods and services which the government wants to provide or be provided and those that the government does not want to be provided. Furthermore, governments have great influence on the health, education, and infrastructure…

Comparing and Contrasting Keynesian & Classical Economics

Economics studies the monetary policy of a government and other information using mathematical or statistical calculations. Fiscal information is analyzed in order to make judgments and inferences from the information provided. There are two economic schools of thought which take different approaches to the economic study of monetary policy, consumer behavior and government spending. Basic Theory (Paragraph 2): This paragraph outlines major some of the differences between Classical and Keynesian economic theories. Classical theorist were rooted in the concept of Laissez faire market which requires little to no government intervention and allows individuals to make decisions, unlike Keynesian economics, where the public and government is heavily involvement in the decision making process in regards to economics. Classical economists also used…