Ib Hl Economics Ia2 Macroeconomics Us Economic Growth Hits Fastest Rate Since 2014 Acs Independent Ib Internal Assessment

763 words - 4 pages

Economics IA2 - Economic Growth - US economic growth hits fastest rate since
2014
Economic growth is an increase in real gross domestic product (GDP) or the real
quantity of goods and services produced over a period of time, usually a year. There are
two types of economic growth: actual and potential growth. The United States of
America’s (USA) economy grew at its fastest pace in four years in the second quarter of
2018, expanding at an annualised rate of 4.1%. There are several reasons and
consequences of this economic growth that I will analyse.
Firstly, the US government implemented expansionary fiscal policies to increase
aggregate demand (AD). A US$1.5 trillion tax cut was granted to businesses and
households which gave them more money to spend. This caused a 4% increase in
consumer spending in the USA as consumers have higher disposable income and
hence, purchasing power. This tax cut may also encourage firms to increase investment
as it increases the expected rate of after-tax return on investment. Consumer
expenditure and investment are both components of aggregate demand (AD), hence an
increase in both would lead to an increase in AD from AD​0 to AD​1 in figure 1.
Furthermore the US government also increased government spending, which further
increases AD from AD​1 to AD​2 in figure 1, as government expenditure is another
component of AD. Hence, real GDP increases from Y​0 to Y​2​, showing actual economic
growth.
Secondly, just before Beijing’s retaliatory tariffs against USA started, US soybean
exports to China skyrocketed as firms rushed to beat new trade tariffs. This led to US
exports increasing by more than 9%, thus total revenue of exports in the US increased.
Exports is also a component of AD, hence an increase in exports caused an increase in
AD, reflected as a rightward shift of the AD curve from AD​2 to AD​3 in figure 1. Real GDP
increases from Y​2​ to Y​3​, showing further actual economic growth.
One benefit this economic growth has brought about is that cyclical unemployment in
the US has been driven to record lows after a long stretch of job gains. This happened
as economic growth helps to promote full employment of resources in the US economy
as firms in the US will need to hire more factors...

RELATED

Benefits and Costs of Economic Growth - Economics class - Essay

862 words - 4 pages Benefits and Costs of Economic Growth Justin Yan "Explain the benefits and costs of economic growth" Economic growth is the increase in ability of an economy to produce goods and services to fulfil the needs and wants of the consumers, essentially it is the long-run increase in a country’s productive capacity. Economic growth can also be defined as an increase in the real value of goods and services produced in the economy which is measured

Economics, microeconomics, macroeconomics - Deakin - Assignment

1748 words - 7 pages (McTaggart et al., 2010). Question 2: It appears that the Australian economy was operating at a below full-employment level or potential GDP in 2014 for following reason. Figure 5 State of the Australian economy in 2014 As Mankiw (2012), the level of labour utilization, proxied by unemployment rate, is strongly correlated with the real economic output. Put differently, a decrease in real GDP will likely to result in a higher unemployment rate. As

What role did Christianity play in the mental health of the active soldiers during World War II? - History of the Americas - Research Paper

576 words - 3 pages 4 IB History HL Internal Assessment What role did Christianity play in the mental health of the active soldiers during World War II? Section 1: Identification and Evaluation of sources This investigation will explore the question: What role did Christianity play in the mental health of the active soldiers during World War II? The dates 1939 to 1945 will be the centralized time period in which the investigation occurs. This allows an in-depth

Analysis of American Community Survey - Northwestern 320 - Essay

1342 words - 6 pages The American Community Survey (ACS) is an ongoing nationwide survey about the nation’s population. It collects information on demographic (such as occupations, race, education level), economic, social and housing characteristics (whether the person owns or rents the home). By providing this vital information to the federal government, state and local agencies, community groups, as well as other organizations, ACS has impacts in a wide variety of

Journal assessment talking about Keynesian - MGU/ Macroeconomics - Journal Assessment

434 words - 2 pages 2 RUNNING HEAD: WEEK 5 JOURNAL ASSESSMENT 2 WEEK 5 JOURNAL ASSESSMENT Week 5 Journal Assessment Bria’na Jade Warnock Georgia Military College Chuck DeVore’s main point of his article was to show how the Trump Administration has increased economic growth, employment rates, and business affairs. The author showed his point by presenting statistics, and by comparing and contrasting throughout his article. According to Forbes, the United States

Financial Liberalization Paper

8415 words - 34 pages paper.Chapter 2Overview of the TopicsThe relationship between interest rate liberalization and economic growth has attracted considerable attention and debate in recent years. The thrust of the debate has been whether interest rate liberalization as originally prescribed by the McKinnon and Shaw hypotheses or can unambiguously lead to economic growth. Since the re-invention of the financial liberalization concept in the 1970s, many countries have made

Explain how the business cycle model represents the dynamic nature of the economy - Castle Hill High School - Economics - Research Paper/ Essay

2099 words - 9 pages Year 11 Economics – Assessment Task 1 – Daniel Morris Part 1 – Explain how the business cycle model represents the dynamic nature of the economy Definition and Diagram of the Business Cycle Business Cycle The business cycle shows the rise and fall of economic activity in an economy. The business cycle is generally measured using the rise and fall in gross domestic product (GDP). The business cycle is split into four main phases which are

OLI and Uppsala model comparison - Durham - Essay

2860 words - 12 pages which the MNE evolves instead of external economic factors (Johanson, 1977). Therefore, MNE, seeming by Johanson and Vahlne, is a firm that has a capability to build, develop and coordinate value-creating multinational business network structures, involving both internal and external actors (Johanson, 2013). Since Haier has constructed under Chinese market which was immature and the local administration was powerful enough to influence domestic

Case Study for Chinese economic development - Final year - Essay

3499 words - 14 pages 1978 only accounted for 11% of economic activity, characteristics of government policies promoting and emphasising ‘self-sufficiency’. The extensive reforms that commenced in 1978 re-oriented the country from a centrally planned economy towards an increasingly decentralised and market-based economy. Since economic reforms GDP has increased from US $189.4 billion in 1978 to $US 356.9 billion in 1990 to US$ 10.36 trillion in 2014. The increase in

Global Business Plan: Coca-Cola Company - MGMT 302 - Business Plan

3826 words - 16 pages , in the initial FDI, China has carried out a series of preferential policies, including land use rights, and fiscal incentives. From a market point of view, the potential is enormous (Blonigen & Piger, 2014). According to the calculation of China’s current economic growth rate, in the future, the potential of the Chinese market will be inestimable and will offer great opportunities. Most importantly, as the first most populous country is the

The distinction between nominal and real GDP - University - essay

680 words - 3 pages rising prices. In fact, the volume of output was falling; in 1974 and 1975 the economy’s output (real GDP) fell by 2.5 and 1.5 per cent respectively. The inflationary effect on nominal growth rates is put in stark focus when we note that the rate of economy-wide inflation, as captured by the percentage change in the GDP deflator, rose to over 26 per cent in 1975. Hence, real GDP assists in illustrating characteristics of economic growth; short

1848 Revolutions Study Guide Is A Documents Containing 7 Pages Of Detailed, Bibliographed Information Separated Into Categories

2536 words - 11 pages street fighting broke out in Italy.Civilians (Todd)* At first there was good unity between the middle class merchants (Libers) and the lower classes.* Later as time went by the unity began to decay with great speed as internal conflicts sparked and interests split.* In most of Habsburg Empire intellectuals tried to put artisans and factory workers behind liberal goals but to no avail.* The new economic and social dissatisfactions sparked further

Income as Measurement of Development - SOAS, Masters - essay

2947 words - 12 pages , along with increasing incomes, promotes human progress and development. Increasing the average per capita income as a result of GDP growth then becomes the logical conclusion to achieve that end. However, GDP per capita comes with its own set of limitations. No measure of Income Equality Distribution The US economy has grown on an average of 2.8% per annum since the 1970s. Yet, income inequality despite such growth has seen a stark rise. The top

economic simultaenous achievement - MY CORAL - essay

1764 words - 8 pages has been able to achieve low inflationary economic growth despite the GFC. Nevertheless, the fundamental conflicts between objectives will always exist and hence policies must work together to achieve the best possible outcomes in all areas. One of the government’s main aims is to achieve internal balance, which includes sustainable economic growth, low unemployment and low inflation. The government’s main economic objective is to achieve the

Spain: Economic Analysis

6942 words - 28 pages opportunities through specialization or technical skills. Some others get discouraged because they could not find a spot in their programs. However, students will eventually wish finishing their studies in order to get a job and start living on their own, since it is not until they finish school or get a decent monthly payment when they can start thinking about being independent. Only people who attend private institutions are more likely to find a