Innovation impacts the cost of production as well. Even the innovation helps in lowering the cost of production and making economies more efficient – producing more outputs with the same number of inputs. Technology affects market structure. In today’s market world, technology advances more rapidly because individuals gain incentives, in the form of profits, to discover new and cheaper ways of doing things. Even the dynamic efficiency refers to a market’s ability to promote cost-reducing or product-enhancing technological change.
A growth company tends to have very profitable reinvestment opportunities for its own retained earnings. Economic growth will affect Etisalat as it would increase their profits due to more people wanting more products and wanting to spend their money. As people have more money to spend on luxuries instead of the essentials it means that the higher value products will be brought. For example the Andrex toilet rolls will be brought instead of Etisalat value, because of this it means more money is being spent in the store which is an advantage for Etisalat. Recession occurs when people involved in business become more cautious and: * Customers cut back on spending, and start to save more * Manufactures and sellers cut back on their orders, produce fewer goods and start to cut back costs in general, including by laying off workers.
If exports were to increase this would result in an increase in AD, as the balance of payment is a factor. The subsequent result of this increase in AD would mean an increase in supply, leading to an increase in the rate of employment, as firms are forced to take on more workers in order to fulfil demand. This means that the increase in exports would reduce specifically cyclical unemployment ( demand deficient unemployment). This is because the increase in exports would result in a increase in AD, hence curing the deficient demand. Furthermore, the cost of the formerly unemployed, i.e.
There are still many people who criticize and oppose the raising the minimum wage. Many believe that increasing the minimum wage would maximize the unemployment rate when in reality it would actually create more job opportunities. This is because increasing the minimum wage will require high relative price for unskilled labor which concludes that firms will have a high demand for skilled labor. The increase of minimum wage increases earnings and reduces
This will mean the population will have more money which will go into the economy, this will mean more income for improving infrastructure and services. Also as TNCs move to other countries, job opportunities increase which means that the quality of life will generally improve too. Another benefit would be that the status of an area would be raised; this may encourage investment by other big name Multi-Nationals and most importantly will improve the countries economy drastically as valuable export revenues will be earned. Most important, they will benefit from cultural exchange creating a cultural integration. LEDC countries do not benefit as much as MEDC countries do, for example, sometimes much of the employment is low paid, low skill, long hours, meaning that the countries do not develop economically or give the opportunity to develop their skills.
Some of the existing effects of the economic factors on aggregate supply are labor costs, wages, foreign supply, productivity, and investments. The relationship between aggregate demand, aggregate supply, and price are determined by the slope of the aggregate demand and supply curves. Taxation has a negative sign for aggregate demand because it reduces disposable income for consumers and it lowers business profits and any investment that may have been financed by those
Not only does the ability& training plays a part the education of one person can allow them to be paid more than an individual with a lower status of education. Discrimination is a huge contribution to income inequality because of people gender, race and age will determine a lot on what job than can be hired for and which job performance will suit the company. Incomes maybe established with different kind of individuals, and the intensity of inequality as well as the purpose for inequality will depend on the circumstance of the groups being compared. Incomes can be compared in many ways within a company or organizations and with diverse economies. The disparities of income between genders, race and social status can allow the opportunity of group forming.
Week 8: Do most Third World education systems promote development? How important are education and health facilities in the development process? What else could be done to improve education and health in these countries? “Education is the key to future economic growth and lasting democracy, leading to greater stability and improved standards of living.” The combination of education and health facilities in the development of third world countries is the most important factor in determining the countries development and growth. This is due to the value of human capital far outweighing the value of infrastructure resources.
Even though raising the minimum wage may benefit people, it will hurt more. Cons to keeping minimum wage the same- Economic Stimulus: Raising the minimum wage means minimum wage workers have more money to spend which means more money goes throughout the economy. More opportunity for jobs: If these minimum wage employees are spending more, than businesses are earning more and need to hire more employees to keep up with the increased sales from the minimum wage employees who are buying more. Reduced Expense for Social Programs: People surviving at minimum
Investment projects, via the multiplier effect should result in an increase in the GDP of the economy; However in order to undertake investment, there must a high savings ratio must be obtained as it is essential for the accumulation of capital. Labour plays a critical role in achieving economic growth. The higher the number of workers there is in an economy should lead to economic growth. If there are more people working and unemployment levels are relatively low, then there is likely to be the achievement of economic growth as human resources