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Thus, since GDP is a full representation of economic growth and production, it has a relatively large impact on nearly every aspect in the economy. When a certain economy is considered healthy, there are a number of related characteristics; low rate of unemployment and an increase in the level of wages as many businesses demand more labor in order to cater for the ever growing economy (Brezina, 20).
Any slight change in the level of GDP is significant to a given economy since it affects the entire stock market. Economists have always argued that any bad economy is always associated with lower profits which implies that there are lower prices o stock in the markets. Thus, many investors in any economy will ever worry about the negative growth of GDP as it is a sole factor used to determine if an economy is on recession or not. A recession is associated with declining revenues in businesses, unemployment and layoffs (Lochner, 3).
Moreover, when the growth rate of GDP is relatively fast, most Federal Reserve raise the rates of interest in order to stem inflation or rather the increasing prices in an economy. This could imply that the loans which are meant for homes and cars will become more expensive and thus businesses will experience high cost of borrowing.
GDP is an extremely important measure in any country’s economy. Despite the fact that GDP cannot be easily determined, its value represents so many aspects in any given economy. This measure is significant to overall spending of a nation since depressions and recessions of a particular country are largely caused by the overall rate of spending. Furthermore, GDP is a measure of confidence since when the government, companies and individuals spend; it is a likely indication of a growing economy. However, when no one is spending, it is a likely indication of a contracting economy. Therefore, this
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Individuals differ in certain unmeasured variables that, if not properly controlled, have influential impact on levels of unemployment. There exists, however, no universally acceptable definition of unemployment so far because both employed and unemployed people worldwide are measured quite differently.
Economic stability determines the nation’s stability in terms of earning of economic condition of the citizens and market. There are various means of measuring the economic stability and the growth or the downfall of countries. In this paper four countries; Canada, Japan, United States and United Kingdom are taken into consideration with an intention to measure and compare their economic stabilities in terms of real GDP, Productivity, Inflation of Price and Labor Market.
In this marketplace-oriented financial system, private individuals and business organizations make the majority of the decisions, and government obtains required commodities and services mainly through private markets. US business organizations enjoy significantly superior flexibility than any of their counterparts in Japan and Western Europe starting from taking decisions to developing lay off surplus, employees, capital plant, as well as innovating new goods.
In the second section the economy after 1920 is described. Here a short view of comparison of today’s economy with the past economy is provided. The comparison is on the basis of economic indicators like GDP, the unemployment and the CPI rate. The Period of 1900- 1910: In 1900 the amount of people unemployed in the US was 1420 (000s) approx and the percent of civilian labor force was only 5%.
The US economy has many challenges especially from the year 2008 when it experienced a recession, high inflation, and high unemployment rates. The recession is reported to be officially over and a new period of new economic growth is expected in 2012 and in the years to follow.
According to the paper, the Indian economy encompasses a number of sectors which range from traditional farming to modern industries. India is one of the major exporters of services and components related to the information and technology sector. The country profited from the advancements made by its citizens in the field of software development.
The population would have a higher standard of living, better education, more available health care, and a higher level of education. These factors would translate into a longer life expectancy and a lower death rate. This study begins by making two hypotheses.