This national debt has continued to increase an average $3.92 billion per day since September 28, 2007. Based off of the assigned video, plethora amounts of people dislike big governments because of taxes; this includes income tax, Medicare, tariffs and international trades. The government has two types of spending, Mandatory and Discretionary spending. Mandatory spending goes towards entitlement programs, social security and interest payments the government has to make. Discretionary spending is at the discretion of the Congress, where the money can be divided up into however they want.
Accomplishing both of these would require an increase in long-term debt of about $1.8million dollars based on calculating Alliance’s external financing need. The investment of the $16million in capital expenditures should be given priority as the potential cost and loss of sales due to a failure of Alliance’s fixed assets would serve to erode the value of Alliance to its owner National as well as make Alliance a greater credit risk for the institutions who own its outstanding debt. An example of the type of financial harm that could be caused by a malfunction of Alliance’s plant and equipment was demonstrated in 2004 when Alliance experienced an earnings decline of nearly 6.5% despite revenues increasing by over
Capital expenditure of $155,000 was incurred during last 2 years. Increase in invested capital reduced both IGR and SGR. As sales growth rate was higher than IGR and SGR, firm had to rely on trade credits and trade notes, besides internal accruals and bank notes to finance its cash outflows. Projections for 1996 are based on information provided and other assumptions described in excel sheets viz. all trade notes will be fully paid and trade credit of 10 days is for additional purchases made from April 1, 1996.
Imports are greater than exports, and so the net effect of trade is a deficit and its net export it –3% The government spending is 19% because state and local governments can't spend more during a recession. They are usually mandated to balance their budgets, and so must cut spending when tax revenues
The U.S Auto Industry: Factors to Consider in a Bailout With continued uncertainty in the economy, and U.S. businesses collapsing all around, another tough decision game recently for the federal Government: Do we, or do we not provide taxpayer dollars to bailout the failing American auto industry? With supporters both for and against an auto bailout, Congress had to make a decision based upon what was best for today’s tough economic times. Recently, two publications, The Nation, and The Pew Research Center, took a closer look at the potential bailout. They examined, very differently, a few of the many factors involved in an auto bailout, but ultimately left the decision up to the reader. I seems that the most heavily weighted subject of the auto bailouts is the concern about the enormous numbers of jobs that would be lost if a bailout is not approved.
Debt appears everywhere in daily life. Most citizens have that experience; they spend more than they earn on their monthly paycheck and live in debt. Similar to such an instance, our economy experiences annual deficit spending. National debt is the total outstanding borrowings of a central government (WebFinance Inc), in other words, the accumulation of our annual deficits. In order to combat this deficit spending, taxes are increased to generate more revenue to pay off this spending.
In 2004, there were approximately 4 working age individuals (aged 20-64) for every 1 person aged 65 and over. By 2056 this ratio is predicted to fall to about 2.1 meaning our dependence on the workers will increase hugely and sadly this means taxation will have to go up. But the UK is not alone in its concerns over pension provision; others include China whose elderly population could double between 2000 and 2027. Most of the developed world is having to consider how best to support older individuals in the presence of an ageing population: Increasing life-expectancy which means that people are spending more and more years in retirement and lower birth rates. In 1900, on average a 65 year-old man in the UK could expect to live for another 10 years (11 years for a
A regressive tax in one in which the percentage decreases as the taxpayers’ income rises. Lower-income earners pay a larger percentage of their income in tax than higher income earners. Therefore such a tax places a larger burden on lower income households than it does on higher income earners. Almost every national government uses regressive taxes to raise a significant portion of its tax revenues. Indirect taxes such as VAT, GST and sales taxes are in fact regressive taxes, placing a larger burden on those whose ability to pay is lower and a smaller burden on the higher –income earners whose ability to pay is greater.
Further it increased both sales and net income by 54% and 28% vs. 1993, but the company has a problem of a liquidity and a shortage of cash. One of the biggest indicators of this problem is almost double decrease in quick ratio in 2 years (Exhibit 1). This means that the company has a decrement of current assets (not considering inventory) comparing to current liabilities by 0.66. Another factor which helps us understand the reason for shortage is Cash Cycle, which consists of Average Collection days and Average Inventory days subtracted by Average Payment days. This indicator is increasing dramatically by almost 11 days in two years, because of increase of Collection and Inventory days by 16 and minor increase of Payables days by 5 (Exhibit 2 and 3).
The policy of reducing debt made MC leave the company with just $36 million cash which was well under the number of 1990 ($283 million cash ). MC’s stock prices fell more than two-thirds from $33.38 in 1989 to $10.50 in 1990, resulting in a drop of $2 billion in market capitalization; even if in 1991 it went up to $16.50. Another consequence was an important decrease of Times interest earned from 2.6 in 1989 to 1.4 in 1990 and 1.5 in 1991 which triggered a depreciation of bond rating from A3 in 1989 to Baa3 in 1991 quite close to junk bonds. For the future this is a strong signal of the MC financial crisis situation. Most liquidity and solvency indicators show that the group would have not been unable to cover its current obligations/liabilities and was close to bankruptcy.