Monetary policy is the use of interest rates to manipulate the level of aggregate demand in the economy and loose (expansionary) monetary policy is a reduction in the interest rates. This will result in an injection of extra consumption because it is cheaper to borrow money on credit cards and therefore allowing consumers to spend more which will cause an increase in aggregate demand (AD). Additionally, extra consumption will allow shops to gain more profit preventing “business failures.” Furthermore, mortgages will be cheaper and therefore consumers feel richer and there will an extra injection of consumption. AD will also increase due to an increase in investment, causing an increase in aggregate demand from AD1 to AD2 as shown below. However,
Therefore, if when a consumer enters a store and sees similarly priced products, one imported and one made domestically, they can choose a US made product without feeling as if they are overpaying for the same product. Many American consumers would like to purchase American products but if American products are considerably priced higher than imports, it will make it a difficult decision. Since the protective tariffs would even the playing field for the consumer, it would be a beneficial implementation. 2. Point #2: Tariffs protect American jobs and wages.
Domestic tourists are ones that travel to places inside their own country. Tourists that travel outside their own country and cross another country’s boarder are considered as international tourists. There are two main reasons for the rapid growth of tourism, these include: increase in leisure time and incomes and technology. The push for the advance of technology has led to travelling being cheaper, quicker and safer. Trade Most goods we buy have a label on them.
A firm’s value depends on the positive net income generated in the past. True False A firm’s value depends on the firm’s ability to generate positive cash flows now and in the future True False When determining the value of a firm, which of the following statements is true? • Inversters are risk neutral. Other things equal they prefer to pay more stocks that are less risky and have uncertain cash flows • Investers love risk. Other things equal they prefer to pay more for stocks that are more risky and have uncertain cash flows.
In a highly competitive business world, on a firm’s priority list is the subject of increasing profit and reducing cost. One might than pose the question, has this put them out of business (mom and pop store)? The answer is absolutely not, but rather, they too benefit from cheaper prices as they continue to buy in bulk and continue to operate as the name suggest, convenient
Second, international markets have more potential consumers. In this society, the economy has increased very rapidly around the world. However, along with the high increase speed of economy, most people in different countries are experiencing a more fast-paced lifestyle. For example, Shanghai has grown into a modern and exhilarating metropolis where students will find a distinctly European flavor. People enjoy a higher standard of life quality and readily embrace foreign influences.
The weaknesses that Kudler may face would be the financial burden of going public. Sometimes expenses pile up just from seeking help from outsiders to protect the investments. The economy has fluctuated over the years; therefore the company needs to ensure they have contingency plans in place when business may not be as stable. There are ample opportunities that can come about from selecting an IPO. A company's debt-to-equity ratio will usually improve after going public, which tends to result in more favorable financing arrangements (2014, Going Public, para 1).
With everything that has been reviewed, I would recommend that CSI lease vs buying right now. The financial returns for the lease option are that it has a higher annual payment and a lower after tax cash flow, but does free up some instant cash and relieves CSI from owner responsibilities on the building. Leasing will also let CSI build up capital to do the end of term buy option without having to have an additional 200,000 of working capital on hand for the bank and will reduce the need for a loan and credit mark. The second option is to
International Trade ECO 372 University of Phoenix There are many contributing factors to the stabilization and prosperity of our global market. We, the United States, are living in a time of severe trade deficit, meaning that we are importing many more goods than we are exporting. While it is nice to be able to buy foreign products at a lower price, there is risk in doing so. When we purchase foreign goods over domestic at lower prices it forces our domestic companies to sell their goods at lower prices to remain competitive. These lower prices may lend to making enough profit to sustain the current workforce.
One tax rate makes for easy computation by the Internal Revenue Service and straightforward payments from taxpayers (Meehan). Because the flat tax taxes only one income, it is easier to understand and to report. Taxpayers save the financial cost of complying with current IRS regulations, which often includes lawyers, accountants and other resources (Meehan). The flat tax remains a popular idea in part because it eliminates double taxation (Meehan). It removes the section of the tax code that is biased against the formation of capital (Meehan).