As a firm grows the average cost of advertising per unit will fall, leading to lower average costs. e.g., small firms are unable to afford large scale advertising campaigns, while their larger competitors are able to finance television and radio campaigns. b) Explain two reasons why McDonald’s will be able to achieve more marketing economies of scale than GBK. McDonald’s is the market leader in the UK; the company is a much bigger firm than GBK with 1,225 UK outlets. A large firm can spread its advertising and marketing budget over a large output and it can purchase its inputs in bulk at negotiated discounted prices if it has sufficient
If we look at D1, we can measure that because the baby population was lower, baby sitters were cheaper. Yet, as the baby population increases to D2, the price also increases due to the shortage of means. Notice also the point of equilibrium moving up and to the right where D2 intersects S1. 2. What is the effect on the market for an hour of babysitting services 14 years into the future, after the birth rate has returned to normal, by which time children born today, during this increased birthrate, will be old enough to work as babysitters?
At this time people wanted to spend their money instead of save it for hard times. Society’s hourly pay rate nearly double and tripled during this era. War factories transitioned from making war materials to making civilian supplies, which lead to the boost in our economy at the time. Today, effects of the Baby Boom have many factors that come into play that affect our economy. According to National Academy of Social Insurance “social security faces a financial challenge from the impending retirement of the largest generation in American history, the 76 million persons born in the “baby boom” years, from 1946 through 1964.
One of the large-scale social and political factors that affect how Sweden’s welfare is organized and provided seems to be the taxes put in place to make Sweden’s welfare program so successful. Sweden is one of the most successful welfare states in the Organization for Economic Cooperation and Development (OECD). Sweden has a higher level of social spending to the GDP (gross domestic product) than any other nation but this all comes from taxes. Every want and need is taxed. Your income is taxed at a higher rate than any other industrialized nation, but most if not all of that money goes into the state welfare program.
Based on a graph presented by David Cooper and Doug Hall in the report “Raising the Federal Minimum Wage to $10.10 Would Give Working Families, And the Overall Economy, a MuchNeeded Boost,” throughout the United States, 11.4 to 27.5% of children (varying by state) have parents who would be affected by the raise in minimum wage. Thus, raising the minimum wage would leave more money for parents of families in poverty to buy their children food, clothes, shoes, and other necessities that, in many low income cases, must be rationed. Amongst those who are struggling to survive off of minimum wage, in 2011, half were under the age of 25 (United State). Many college students struggle to balance time for academics, extracurricular activities, as well as finance: car payments, rent, student loans, food, gas, and many others. One article from USA Today, “How Much Would a MinimumWage Increase Help Students?” by Jackie Tempera, features a college student, Christin King.
However, one factor that should be taken into consideration is the millions of dollars in government assistance that parents not receiving child support are forced to rely on. Fear is a very strong motivator, and, knowing they will have consequences to face, could make non-custodial parents much more likely to take care of their responsibilities. In many cases, receiving child support would give these struggling parents the economic boost they need to get on their feet and of public assistance. Child support usually increases a family’s income 17% - 30% which could greatly improve their standard of living. I truly feel this is worth
Welfare Reforms The dream of most women is to have the traditional family, which includes a husband and their children. There are more single mothers in this day and age that face more challenges on the way to achieving the American Dream. They find it hard to provide financially even working a full-time job because the pay is normally minimum wage and most still rely on public assistance to make ends meet. Some single mothers lack education and work experience, which prevents them from obtaining a decent paying job. Budget cuts to welfare programs are making it that much harder for the single mother to provide the necessities for their children because these supplemental programs are necessary to the day to day workings of a family.
This is due to the value of human capital far outweighing the value of infrastructure resources. This means that having increased levels of educated and qualified population will lead to higher levels of growth within an economy. Education has definitely been acknowledged as an important aspect of development with many countries increasing their levels of spending exponentially. Currently 75 million people are not able to access primary education, with more than half of them being made up of women. 98% of people who do not have access to education live in developing or third world nations, this is a serious issue when looking at why poverty and low standards of living are so dominant.
Though the need for child care for working parents became quite important and thus gave rise to the early childhood education, the other main reason behind its popularity are the studies which revealed that such educational programs leave a lasting effect on the children from disadvantaged backgrounds. Researchers conclude that good early childhood education not only improves the lives of children and their families but also is the main factor behind substantial economic benefits for society. The five major philosophers of early childhood education are Friedrich Froebel, John Dewey, Maria Montessori, Lev Vygotsky and Jean Piaget. All of them have their own viewpoints regarding this
Externalities cause deadweight loss which can lead to market failure. Businesses can make more money if they can internalize the externalities. Externalities can be internalized if the transaction cost of the business is low. “Transaction costs are the costs of identifying and bringing buyers and sellers together, bargaining and drawing up a contract”2and it is relatively high for department stores like Galeria Kaufhof in comparison to stores like H&M. Similarly, the transaction cost for stores such as H&M is more than that of the jewelry shops but less than the department stores.