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Sloman (2006) has explained that demand is limitless and is related to wants. Moreover, if goods and services were free, people would simply demand whatever they wanted. Supply on the other hand has limits. It is related to the resources available to the firms (Sloman, 2006, p.5). Growth, inflation, unemployment, GDP etc are some of the areas in which microeconomics is mostly interested in. This paper mainly focus on Gross Domestic Product (GDP) and its effects on a country’s economic growth and personal wellbeing.
Mankiw & Taylor (2006) have mentioned that GDP is a measure of total income of a nation (Mankiw & Taylor 2006, p.464).They also pointed out that GDP is the total market value of all final goods and services produced within a country in a given period of time (Mankiw & Taylor 2006, p.466). It is calculated based on the total consumer investment and government spending, plus the value of exports, minus the value of imports (GDP, n. d). The following formula can be used to calculate the GDP of a country in given financial year.
From the above equation it is clear that when the import increases the GDP decreases whereas when the consumer spending, investment made by industries, and governmental spending increases, the GDP also increases. The current recession (Recession is a phenomenon in which the output in the economy declines or the growth becomes negative (Sloman, 2006, p.6)), has forced people to think twice before lavishly spending their moneys. Westerners who normally spend more than what they earn has already started to save some money for the future after visualizing the negative impacts of recession. But from the above formula it is evident that too much saving can drastically affect the GDP. GDP is a measure of standard of living in a country even though many economic Gurus have different opinions. The GDP performances of United State in the recent years can be
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2. Discussion According to the main growth models, the two major alternative two main alternative determinants of economic growth have been suggested as Total Factor Productivity (TFP) and factor accumulation (Solow, 1957). According to the dependency theories of growth, there are two groups of nations, one being the core group consisting of the developed nations and the other being the periphery, consisting of the less developed nations (Uche, 1994).
Introduction This report gives a detail of business management of BMW during the period of 2004 when the automotive industry was facing threat from external environment and various factors in the industry related to the competitive advantage and competitors.
The microfinance model does not pay attention to the crucial roles dictated by scale economies. By definition, microfinance results in micro-enterprises and this means that agricultural units and enterprises that are small in size often operate under efficient and effective scales.
e that the people of a country would receive the best of every thing that could be education, housing, health services or the other various basic necessities.
Economics has been called and is known as a Social Science one that actually focuses on the subject matter that is
China is now the largest recipient of foreign direct investment (FDI) in the developing world. According to Wang et al., (2002), recent years have witnessed the emergence of China as one of the most important destinations for foreign direct investment
It is the commonly used term in the media for banks that have grown too big for the government to allow them to fail because too many people will be affected adversely. I’ll just remove the quotation marks.
These very large banks
These tools enable professional mainstream economists to address various economic issues facing the world. Mainstream economics is about modeling in a way that traditional or heterodox economics is not. It originated from the neoclassical synthesis of the neoclassical
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