Inflation and Aggregate Expenditure Essay Example

Inflation and Aggregate Expenditure Essay A change in all of the following will cause a shift in the consumption function, EXCEPT: A. Investment 2. Planned investment is a function of which of the following variables? C. Technology 3. The planned investment function shows the relationship between planned investment and the real rate of interest, thus the planned investment curve is ____________________. A decrease in the price of capital will cause this curve to ___________________. D. Downward sloping; shift outward 4. An increase in the foreign price level relative to the U. S. price level would cause the import (IM) function to: B. Shift downward 5. An increase in the real rate of interest would lead to which of the following outcomes? A. A decrease in consumption B. A decrease in planned investment C. A decrease in planned aggregate expenditure D. All of the above 6. The planned aggregate expenditure (PAE) curve/line is: A. Upward sloping 7. The import function is _______________ , while the net export function is __________. D. Upward sloping; downward sloping 8. An income tax decrease for individual consumers will cause the planned aggregate expenditure function to: A. Shift upward 9. An increase in the real rate of interest will cause the planned aggregate expenditure function to: B. Shift downward 10. Economic activity moves from a period of expansion to a _______ and then moves into a period of _______ until it reaches a _____. B. Peak, recession; trough 11. Potential output is: D. The maximum sustainable amount of output. 12. Planned investment may differ from actual investment because of: C. Unplanned changes in inventories. 13. The consumption function is the relationship between consumption and: D. Its determinants, such as disposable income. 14. The slope of the consumption function: D. Equals the mpc. 15. The tendency of changes in asset prices to affect spending on consumption goods is called the _____ effect. C. Wealth 16. When housing prices decrease, household wealth _____ and consumption _____. C. Decreases; decreases 17. The marginal propensity to consume is the: B. Amount by which consumption increases when disposable income increases by $1. 18. Under the fixed price model where expected inflation is zero, an increase in government spending in the short run will lead to which of the following? A. An upward shift in the planned aggregate expenditure function B. An increase in real income C. An increase in the nominal rate of interest D. An increase in the real rate of interest E. All of the above 19. We will write a custom essay sample on Inflation and Aggregate Expenditure specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Inflation and Aggregate Expenditure specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Inflation and Aggregate Expenditure specifically for you FOR ONLY $16.38 $13.9/page Hire Writer The difference between potential output and actual output is called the____________. C. Output gap 20. The primary difference between active fiscal policy and automatic stabilizers in regards to their lagged impacts, is that active fiscal policy does not contain an inside lag period, while the automatic stabilizers do contain an inside lag period B. False 21. If the economy experiences a credit crunch all of the following are true EXCEPT: D. The interest rate on bonds rises 22. To close a recessionary gap, the Fed ____ interest rates which ______ planned aggregate spending and _____ short-run equilibrium output. A. Lowers; increases; increases 23. The aggregate demand curve shows the relationship between output and the ______ rate. D. Inflation 24. In the long run, an increase in the nominal money supply will cause the inflation rate to: A. Increase. 25. In the long run, an increase in the nominal money supply will cause output to: C. Remain unchanged. 26. In the long run, an increase in the nominal money supply will cause the nominal interest rate to: C. Remain unchanged. 27. The macroeconomy is comprised of four primary markets: the labor market, the goods market, the money market, and the bond market. What is the minimum number of these individual markets that must be in equilibrium to ensure that the whole macroeconomy is equilibrium? C. 3 28. The aggregate demand curve is: B. Downward sloping 29. An increase in the actual rate of inflation will cause the aggregate demand curve to: C. Not shift 30. Which of the following will result in an outward shift in the aggregate demand curve? A. An increase in government spending B. A decrease in taxes C. An increase in the money supply D. All of the above 31. The long-run aggregate supply curve is___________, while the short-run aggregate supply curve is______________. D. Vertical; upward sloping 32. According to the Fisher Effect, a 3% increase in expected inflation leads to a 3% increase in the real rate of interest. B. False 33. An increase in expected inflation in the long-run will lead to each of the following outcomes EXCEPT: A. A decrease in the nominal rate of interest 34. In the short run, an increase in government spending will cause the inflation rate to: A. Increase. 35. In the short run, an increase in government spending will cause output to: A. Increase. 36. In the short run, an increase in government spending will cause the nominal interest rate to: A. Increase. 7. In the short run, an increase in government spending will cause planned investment to: B. Decrease. EC202 Exam III Form A Part II 1. Using the following graph to answer the questions below. Assume planned investment, government purchases, net exports, and net taxes are autonomous variables. The only component of planned aggregate expenditure that depends on income is cons umption. Assume you at currently at equilibrium marked by the â€Å"x† and the vertical line is the potential output of Y*. (1 pt. each question) A. What is the output gap in this economy? Output Gap = Actual – Potential = 150 – 300 = -150 Billion B. Given the above scenario, is this economy experiencing a recessionary gap, an expansionary gap, or no gap in output? Recessionary Gap C. In order for the government to eliminate the output, by how much would the government need to increase their expenditures? The government would need to increase their expenditures by 50 billion as that would cause the PAE curve to shift upward to the new equilibrium. D. Given the above scenario, what is the economy’s marginal propensity to consume (MPC)? The MPC in this scenario is equivalent to the slope of the PAE curve. We calculate slope as rise/run†¦. thus (150-50)/(150-0) = 100/150 = . 7 Schaffer 12/6 7 E. What is the income-expenditure multiplier in this economy? (Continued from 1. ) Income Multiplier = 1/(1-MPC) = 1/(1-. 67) = 1/. 33 = 3. 00 2. Compare and contrast between automatic stabilizers, active fiscal policy, and monetary policy. Be sure to fully explain each variant of policy, provide examples of each type of policy, and explain which policy action is the fastest using the lag terms we discussed. (6 pts) Automatic Stabilizers are provisions in the law that imply automatic increases in government spending or decreases in taxes when real output (income) declines. A good example of an automatic stabilizer is unemployment compensation. Active fiscal policy consists of actions taken on behalf of the government to change a law or pass a bill to enact some form of stimulus. A good example of this type of policy was the TARP package or the stimulus passed by George W. Bush at the onset of the financial crisis. Monetary policy are actions taken by the Federal Reserve to stimulate the economy via open market operations, changes in the discount rate, or changes in the required reserve ratio. Since the automatic stabilizers contain no inside lag it is the fastest policy action. However, in terms of policy that needs to be implemented, monetary policy is faster than fiscal policy as the action lag for the Fed is much faster than the active fiscal policy. Schaffer 12/6 8 3. Using the AD/AS model that we developed in class, explain the impacts of a decrease in taxes by the government in the long run. Specifically your final answer should clearly state the overall impact on output, inflation, the nominal and real interest rate, and planned investment. As in the class example, you may assume that expected inflation is zero. 6 pts) Increase in output | inflation, nominal and real interest rates, and planned investments are all indeterminate 4. Using the AD/AS model that we developed in class, explain the impacts of a credit crunch in the short run. Specifically your final answer should clearly state the overall impact on output, inflation, the nominal and real interest rate, and planned investment. As in the class example, you may assume that expected inflation i s zero. (6 pts) Decrease in output | decrease in inflation | decrease in nominal and real interest rates | Increase in planned investment Schaffer 12/6 9 5. Using the AD/AS model that we developed in class, explain the impacts of an increase in average labor productivity on economic growth (obviously this is a long run question). Specifically your final answer should clearly state the overall impact on output, inflation, the nominal and real interest rate, and planned investment. As in the class example, you may assume that expected inflation is zero. (6 pts) Increase in output | decrease in inflation | nominal and real interest rates and planned investment are indeterminate Inflation and Aggregate Expenditure Essay Example Inflation and Aggregate Expenditure Essay A change in all of the following will cause a shift in the consumption function, EXCEPT: A. Investment 2. Planned investment is a function of which of the following variables? C. Technology 3. The planned investment function shows the relationship between planned investment and the real rate of interest, thus the planned investment curve is ____________________. A decrease in the price of capital will cause this curve to ___________________. D. Downward sloping; shift outward 4. An increase in the foreign price level relative to the U. S. price level would cause the import (IM) function to: B. Shift downward 5. An increase in the real rate of interest would lead to which of the following outcomes? A. A decrease in consumption B. A decrease in planned investment C. A decrease in planned aggregate expenditure D. All of the above 6. The planned aggregate expenditure (PAE) curve/line is: A. Upward sloping 7. The import function is _______________ , while the net export function is __________. D. Upward sloping; downward sloping 8. An income tax decrease for individual consumers will cause the planned aggregate expenditure function to: A. Shift upward 9. An increase in the real rate of interest will cause the planned aggregate expenditure function to: B. Shift downward 10. Economic activity moves from a period of expansion to a _______ and then moves into a period of _______ until it reaches a _____. B. Peak, recession; trough 11. Potential output is: D. The maximum sustainable amount of output. 12. Planned investment may differ from actual investment because of: C. Unplanned changes in inventories. 13. The consumption function is the relationship between consumption and: D. Its determinants, such as disposable income. 14. The slope of the consumption function: D. Equals the mpc. 15. The tendency of changes in asset prices to affect spending on consumption goods is called the _____ effect. C. Wealth 16. When housing prices decrease, household wealth _____ and consumption _____. C. Decreases; decreases 17. The marginal propensity to consume is the: B. Amount by which consumption increases when disposable income increases by $1. 18. Under the fixed price model where expected inflation is zero, an increase in government spending in the short run will lead to which of the following? A. An upward shift in the planned aggregate expenditure function B. An increase in real income C. An increase in the nominal rate of interest D. An increase in the real rate of interest E. All of the above 19. We will write a custom essay sample on Inflation and Aggregate Expenditure specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Inflation and Aggregate Expenditure specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Inflation and Aggregate Expenditure specifically for you FOR ONLY $16.38 $13.9/page Hire Writer The difference between potential output and actual output is called the____________. C. Output gap 20. The primary difference between active fiscal policy and automatic stabilizers in regards to their lagged impacts, is that active fiscal policy does not contain an inside lag period, while the automatic stabilizers do contain an inside lag period B. False 21. If the economy experiences a credit crunch all of the following are true EXCEPT: D. The interest rate on bonds rises 22. To close a recessionary gap, the Fed ____ interest rates which ______ planned aggregate spending and _____ short-run equilibrium output. A. Lowers; increases; increases 23. The aggregate demand curve shows the relationship between output and the ______ rate. D. Inflation 24. In the long run, an increase in the nominal money supply will cause the inflation rate to: A. Increase. 25. In the long run, an increase in the nominal money supply will cause output to: C. Remain unchanged. 26. In the long run, an increase in the nominal money supply will cause the nominal interest rate to: C. Remain unchanged. 27. The macroeconomy is comprised of four primary markets: the labor market, the goods market, the money market, and the bond market. What is the minimum number of these individual markets that must be in equilibrium to ensure that the whole macroeconomy is equilibrium? C. 3 28. The aggregate demand curve is: B. Downward sloping 29. An increase in the actual rate of inflation will cause the aggregate demand curve to: C. Not shift 30. Which of the following will result in an outward shift in the aggregate demand curve? A. An increase in government spending B. A decrease in taxes C. An increase in the money supply D. All of the above 31. The long-run aggregate supply curve is___________, while the short-run aggregate supply curve is______________. D. Vertical; upward sloping 32. According to the Fisher Effect, a 3% increase in expected inflation leads to a 3% increase in the real rate of interest. B. False 33. An increase in expected inflation in the long-run will lead to each of the following outcomes EXCEPT: A. A decrease in the nominal rate of interest 34. In the short run, an increase in government spending will cause the inflation rate to: A. Increase. 35. In the short run, an increase in government spending will cause output to: A. Increase. 36. In the short run, an increase in government spending will cause the nominal interest rate to: A. Increase. 7. In the short run, an increase in government spending will cause planned investment to: B. Decrease. EC202 Exam III Form A Part II 1. Using the following graph to answer the questions below. Assume planned investment, government purchases, net exports, and net taxes are autonomous variables. The only component of planned aggregate expenditure that depends on income is cons umption. Assume you at currently at equilibrium marked by the â€Å"x† and the vertical line is the potential output of Y*. (1 pt. each question) A. What is the output gap in this economy? Output Gap = Actual – Potential = 150 – 300 = -150 Billion B. Given the above scenario, is this economy experiencing a recessionary gap, an expansionary gap, or no gap in output? Recessionary Gap C. In order for the government to eliminate the output, by how much would the government need to increase their expenditures? The government would need to increase their expenditures by 50 billion as that would cause the PAE curve to shift upward to the new equilibrium. D. Given the above scenario, what is the economy’s marginal propensity to consume (MPC)? The MPC in this scenario is equivalent to the slope of the PAE curve. We calculate slope as rise/run†¦. thus (150-50)/(150-0) = 100/150 = . 7 Schaffer 12/6 7 E. What is the income-expenditure multiplier in this economy? (Continued from 1. ) Income Multiplier = 1/(1-MPC) = 1/(1-. 67) = 1/. 33 = 3. 00 2. Compare and contrast between automatic stabilizers, active fiscal policy, and monetary policy. Be sure to fully explain each variant of policy, provide examples of each type of policy, and explain which policy action is the fastest using the lag terms we discussed. (6 pts) Automatic Stabilizers are provisions in the law that imply automatic increases in government spending or decreases in taxes when real output (income) declines. A good example of an automatic stabilizer is unemployment compensation. Active fiscal policy consists of actions taken on behalf of the government to change a law or pass a bill to enact some form of stimulus. A good example of this type of policy was the TARP package or the stimulus passed by George W. Bush at the onset of the financial crisis. Monetary policy are actions taken by the Federal Reserve to stimulate the economy via open market operations, changes in the discount rate, or changes in the required reserve ratio. Since the automatic stabilizers contain no inside lag it is the fastest policy action. However, in terms of policy that needs to be implemented, monetary policy is faster than fiscal policy as the action lag for the Fed is much faster than the active fiscal policy. Schaffer 12/6 8 3. Using the AD/AS model that we developed in class, explain the impacts of a decrease in taxes by the government in the long run. Specifically your final answer should clearly state the overall impact on output, inflation, the nominal and real interest rate, and planned investment. As in the class example, you may assume that expected inflation is zero. 6 pts) Increase in output | inflation, nominal and real interest rates, and planned investments are all indeterminate 4. Using the AD/AS model that we developed in class, explain the impacts of a credit crunch in the short run. Specifically your final answer should clearly state the overall impact on output, inflation, the nominal and real interest rate, and planned investment. As in the class example, you may assume that expected inflation i s zero. (6 pts) Decrease in output | decrease in inflation | decrease in nominal and real interest rates | Increase in planned investment Schaffer 12/6 9 5. Using the AD/AS model that we developed in class, explain the impacts of an increase in average labor productivity on economic growth (obviously this is a long run question). Specifically your final answer should clearly state the overall impact on output, inflation, the nominal and real interest rate, and planned investment. As in the class example, you may assume that expected inflation is zero. (6 pts) Increase in output | decrease in inflation | nominal and real interest rates and planned investment are indeterminate

Resting Easy! 5 Top Tips for Beating Student Insomnia

Resting Easy! 5 Top Tips for Beating Student Insomnia Resting Easy! 5 Top Tips for Beating Student Insomnia If you’re a student, there’s a good chance you’re tired while you’re reading this. After all, there’s a lot you have to pack into your life: studies, a social life, a part-time job, extracurricular activities Finding time to sleep amidst all this can be hard! Add to that the high rates of insomnia caused by stress and bad sleeping habits, and we have a lot of exhausted students out there! Scenes like this can be seen in college libraries across the world. [Photo: Shanghai killer whale/wikimedia] But a lack of sleep can affect your grades, as well as your long term health. So it might be time to put sleeplessness to bed (PUN ALERT! PUN ALERT!) using our top five tips for beating insomnia! 1. Have a â€Å"Bedtime† You probably remember â€Å"bedtime† as something you resented as a child. But now that you’re old enough not to have to be told when you should rest, setting a regular time at which you go to bed can ensure healthier sleeping habits. 2. Beware Screens We’re all glued to our smartphones, tablets and laptops these days, but did you know that the blue light these screens emit can trick your brain into thinking it is daytime when it isn’t? Not likely to sleep any time soon. [Johan Viirok/flickr] If you need to use your computer or smartphone in the evening, you should use a filter that removes the blue light produced by many electronic devices so it doesn’t affect your sleeping patterns. 3. Diet and Exercise As much as you might hate to hear it, a diet of beer, coffee and junk food (all celebrated parts of the student lifestyle) is unlikely to help you sleep. Particularly important is cutting back on caffeine, alcohol and fizzy pop before bed. Likewise, some vigorous exercise around six hours before you sleep will burn up excess energy and help ensure a peaceful night. 4. De-Stress Yo’ Self! Stress is a cause of insomnia and lack of sleep can cause stress, so it’s easy to get stuck in a vicious circle of not sleeping and worrying about feeling exhausted. As such, it’s vital to know the signs of stress and to relax whenever possible. If you don’t feel like you have time to chill, it might be a good idea to cut down on non-essential activities so that you have chance to rest. 5. Manage Your Sleep Environment Make sure your bedroom is a suitable sleeping habitat. Ideally, your room will be cool, dark and quiet throughout the night. And a good mattress is an investment you won’t regret. If you still need convincing, try spending several months sleeping on an inflatable mattress in a tiny box room in a busy, noisy part of town and see how tired you feel at the end of it. In our experience, this is enough to make anyone appreciate the value of a proper bed. These guys have it right. Be more like these guys.

Bill of Rights - Smart Custom Writing Samples

Bill of Rights - Smart Custom Writing Human Resource ManagementIt might sound indisputably to say that the planet we inhabit and all living beings are under the constant process of movement. Still, another true point suggests itself. The movement appears to be quite an ambiguous notion, since it can be represented by either progress or regress. Needless to say, the contemporary world strives for constant development, evolvement and progress. In this tight connection emerges the notion of leadership, the latter in its turn provokes competition. Nowadays world with its immitigable and unforgiving race and pace inevitably induces companies to be involved in the competitive rush. Clearly, to be the first means a lot. In attempts to take dominant position in the marketplace of rivals the companies are forced to resort to complicated strategies and tactics. After all, leadership is undoubtedly worthwhile expending some effort with the intention to overcome obstacles and hindrances on the way. Currently contest participants encounter the difficulties to be tackled. They are facing a trickish problem of competitive challenges, these being the challenge of sustainability, global challenge and technology challenge. With the aim to have a clear idea of how the above mentioned challenge factors matter, let’s scrutinize a company’s inner structure in general. It’s true to claim, each company focuses on success but to make this success feasible it has to attract a lot of resources. First of all, it is people employed, thus forming the personnel in each company’s department. Second of all, that is technological base. Third of all, inputs into the research field. Fourth of all, it is the company budget that forms the condition for the company’s development and all its constituents’ improvement.   Thus we deal with the mutual interconnection and interdependence. Hence, it’s hard to imagine each sector of the company’s arrangement to do without a human resource as a ‘fuel of production’ (Jeremy Gutsche. 2009, Sept. 23). The extant to which a separate staff member and the whole coherent team will be the contribution to the company de pends on the high quality of the functions performed. Therefore the human resources management (HRM) plays the role of an accelerator and intensifier of the employees’ potential leading to the prosperity of the company. Moreover, the HRM practices are supposed to be in compliance with the company’s rules and the main policy it pursues (Carter McNamara). So, the HRM is called for promoting the capabilities of each company’s member by means of special programs and training courses to reach the goals of a particular organization. Up to a point, we need to elucidate the whole HRM system’s mechanism. By means of being involved in the process of personal ‘upgrading’ each member acquires useful experience and enhances his or her own proficiency. But how can be a global challenge addressed? The answer is in the thoroughly elaborated HRM strategy that may be seen as follows. With the help of clever HRM each particular specialist in the sphere of his or her responsibility becomes not only aware of the technological novelties, progressive engineering, international economic and political situation, but also of how the acquired knowledge can be applied in the company’s specific sector. Thus, the technological challenge becomes not so irresistible and insurmountable with the highly qualified collaborative team of computer engineering workers, IT specialists who are always in the know of changes and are the first to develop new and new high tech ‘products’. The processes of globalization and integration embrace the international market as well. Contemporary situation in the global marketplace is that the customers’ demands are constantly rising, by this forcing the companies to always keep its head on a swivel not to let a client slip into another company’s hands. Thus we speak about the global competition scale. Giving the unceasingly changing global picture, arises the necessity of the company’s prompt operational response and reaction what increases the demand in HRM practices with the help of which the staff research the modern global tendencies to implement the information gathered and expand the horizon of the company’s activity and investment policy offshore. The HRM assists in overcoming the challenge of sustainability. Virtually, the very term sustainability presupposes to be able to endure, survive by reducing and eliminating negative influences. Due to the cooperative and joint efforts and powerful technological armory, awareness in the world processes the company’s business is sure to keep up with the time and secured against defeat in every day struggle for leadership and thus is able to demonstrate long-term performance and prosperity on the global market. HRM doesn’t stand still either. It introduces and encloses new approaches and methods to develop the resistance to negative and formidable global factors. The importance of such organization as the HRM is dramatically increasing, since its practices are directed to and focused on the company-bound policy and flexible, subtle and smart human resource coordination and monitoring by proving constant and systematic trainings. Not of the least is the strategy of the contemporary HRM that also realizes the role of technologies in making the administration performance not so time-consuming and the staff productivity more effective. On the whole, the human resources (HR) being an integral part of any organization, company, enterprise by means of skillful HRM are the driving power in counteracting the competitive challenges that may inflict damage not only on the company’s finances but also be menacing to the whole company’s organism.

Sport coaching Essay Example | Topics and Well Written Essays - 1250 words

Sport coaching - Essay Example By considering athletics as the multi-skill sport, the key target audience will be young sportspersons within the age group of 12 to 25 years. Development of psychology and discipline as a part of sport coaching would be the key result areas for the coaches with regard to this group of athletes. The relevance of the coaching sessions and its importance will be evaluated through the essay. Coaching is an important aspect in the field of sports as it assists the athletes in developing their skills and leading a disciplined life. Quality coaching aids in enhancing the safety, health and self-esteem of the sports person. It promotes fair play, social unity among the players, teamwork and assists in developing a quality life with enjoyment (The National Coaching Foundation, 2008). The process of coaching includes three major elements i.e. planning, conducting and evaluating. The planning is to develop a proper training schedule to assist the athletes belonging to the age group of 12-25 years in achieving their goals. Conducting refers to the applicability of the training sessions as planned prior by the coach. Evaluation of coaching refers to determining the progress of the athletes in the games of athletics which is a multi-skilled sport discipline (BrianMac Sports Coach, 2014). The Long Term Athlete Development (LTAD) model is a part of the coaching regiment for the phy sical development of the athlete with regard to the sports such as track and field, long jump and high jump. LTAD model facilitates in the development of proper physical activity, balance, coordination and agility of the athletes which in turn will aid to channel the energy of the athletes in the right direction (SCCU, 2011). Warm Up is a significant part for the athletes at the beginning of the session as it will help them in gaining the rhythm along with energising them for the training. Warm up signifies

Econ Article Analysis Assignment Example | Topics and Well Written Essays - 1500 words

Econ Article Analysis - Assignment Example This left them with options of either to cut back on farming sharply or to buy water up to four times the regular price. Therefore, this excerpt summarizes various economic theories that are highlighted on the article by fortune Tech. Notably, supply and demand is a critical in economics; essentially, demand refers to the desire of a product or services by buyers whereas supply refers to the extent to which the market can offer. In other words, demand is the price that people are willing to purchase the demand quantity and this relationship forms a demand relationship. On the other hand, the amount that suppliers will be willing to supply given a certain offer is the quantity supplied and this correlation is termed as supply relationship. For instance, there comes a time that supply outstrips the demand and an example would be the case of a third generation farmer â€Å"Woolf† who grows onions garlic and tomatoes. Her intentions were to cultivate on half of her farm since customers were asking more of their product. They cannot deliver because water is still the problem3. Experts have said that an estimate of 500 000 acres of rich land will be left fallow this year and keeping in line with the laws of demand and supply food prices will rise. Most of the things with high demand are very limited. Since we live in a world where wants are unlimited, the available resources to satisfy our wants are limited too. Demand and supply explain how prices are determined in a market system. This is reflected by the demand curve and a demanding schedule. The law of demand has a negative correlation between quantity of goods that consumers need and the price they are ready and able to pay, when other factors are held constant. The factors that affect demand other than price include price of related goods that are substitutes and compliments, income, tastes and preference, population and demographics, and expected future prices. Therefore, changes in any of these

Equilibrium Equality Demand Supply

Equilibrium Equality Demand Supply Equilibrium means a state of equality between demand and supply. Without a shift in demand and/or supply there will be no change in market price. In the diagram below, the quantity demanded and supplied at price P1 are equal. (Baryla, 1995, 13) At any price above P1, supply exceeds demand and at a price below P1, demand exceeds supply. In other words, prices where demand and supply are out of balance are termed points of disequilibrium. Changes in the conditions of demand or supply will shift the demand or supply curves. This will cause changes in the equilibrium price and quantity in the market. Consider the following example. The weekly demand and supply schedules for T-shirts (in thousands) in a city are shown in the table below: Price ( £) 8 7 6 5 4 3 2 1 Demand 6 8 10 12 14 16 18 20 Supply 18 16 14 12 10 8 6 4 Demand 2 10 12 14 16 18 20 22 24 Supply 2 26 24 22 20 18 16 14 12 The equilibrium price in the market is  £5 where demand and supply are equal at 12,000 units. If the current market price was  £3 there would be excess demand for 8,000 units. If the current market price was  £8 there would be excess supply of 12,000 units. A change in fashion causes the demand for T-shirts to rise by 4,000 at each price. The next row of the table shows the higher level of demand. Assuming that the supply schedule remains unchanged, the new equilibrium price is  £6 per tee shirt with an equilibrium quantity of 14,000 units. The entry of new producers of T-shirts into the market causes a rise in supply of 8,000 T-shirts at each price. The new equilibrium price becomes  £4 with 18,000 units bought and sold. Assuming there is pure competition in the market place, and no government intervention, we are able to focus on how the price mechanism determines the equilibrium price in the market. Markets can be effective at resolving the basic issues of what and how much to produce at a certain price level although left to operate on its own, the market can still create unsatisfactory outcomes. When markets do not produce the desired outcome, it is known as market failure and when this occurs, governments may intervene in the market. (Baryla, 1995, 13) How the price mechanism brings about the equilibrium price in the market can be determined assuming we have pure competition in the market place and no government intervention. Simply put, the concept of pure competition mean that no participant in the market has the power to influence market outcomes directly, such as by setting prices. The price mechanism is the interplay of the forces of supply and demand in determining the market prices at which goods and services are sold and the quantity of which is produced. The quantities of goods and services demanded and supplied is regulated by the prices of those goods and services. If the price of a commodity for sale is too high according to consumer demand, the quantity supplied will exceed the quantity demanded. If the price of a commodity is too low according to consumer demand, the quantity that is demanded will exceed the quantity supplied. There is one price, and only one price, at which the quantity demanded, is equal to the quantity supplied. This is known as the equilibrium price. (Belkin, 1976, 57) The market forces of supply and demand interacting to determine the equilibrium price which at this price the market clears and eliminates any excess supply or demand is the price mechanism in action. (Brown, 2000, 66) There is no tendency for change at the equilibrium point. In this way it is said that the market mechanism, besides being the natural consequences of the forces of supply and demand, provides the most efficient economic outcomes possible without any explicit coordination. Although markets can be effective at resolving the basic issues of what and how much to produce, left to operate by it, the market can still create unsatisfactory outcomes. For goods and services in product markets, the market price may be considered to be too high or too low. From the free interplay of demand and supply, the equilibrium quantity that results may also be considered too high or too low. Some goods and services may not even be produced at all. Market failure occurs because the price mechanism takes account of the private costs and benefits of production, to producers and consumers, but does not take into account the impact of an economic activity on outsiders. For example, the market may ignore the costs imposed on outsiders by a firm polluting the environment. Governments may intervene in the market when market failure occurs. The market determined price for some commodities may be thought by the government to be too high or too low. The government may therefore intervene in the marketplace in order to apply either price ceilings, where the government imposes a limit on how high a price can be charged for a product, or price floors, the minimum price that can be charged for a particular commodity. (Geltner, 1995, 119) Affecting the distribution of income, the manner in which income is divided among the members of the economy, is the main reason for influencing prices in this way. Price ceilings will redistribute money from sellers to buyers, whereas price floors will redistribute money from buyers to sellers. In conclusion, the market forces of supply and demand interact with each other to bring about market equilibrium, clearing the market of excess demand or supply. In this way, it is said that the market mechanism achieves consistency between plans and outcomes for consumers and producers without explicit coordination. Government intervention is very important in providing the desired outcomes of the society. Overall, market equilibrium is determined by the price mechanism, supply and demand curves, surplus and shortage, increases and decreases in supply and demand curves, market behaviours and government intervention. (Hendershott, 1997, 13) References Baryla, E.A., Zumpano, L.V. (1995), Buyer search duration in the residential real estate market: the role of the real estate agent, The Journal of Real Estate Research, Vol. 10 No.1, pp.1-13. Belkin, J., Hempel, D., McLeavey, D. (1976), An empirical study of time on the market using multidimensional segmentation of housing markets, Journal of American Real Estate and Urban Economics Association, Vol. 4 No.2, pp.57-75. Brown, G., Matysiak, G.A. (2000a), Real Estate Investment: A Capital Market Approach, Financial Times Prentice-Hall, Harlow, . Brown, G.R., Matysiak, G.A. (2000b), Sticky valuations, aggregation effects and property indices, Journal of Real Estate Finance and Economics, Vol. 20 No.1, pp.49-66. Geltner, D., Mei, J.P. (1995), The present value model with time-varying discount rates: implications for commercial property valuation and investment decisions, Journal of Real Estate Finance and Economics, Vol. 11 No.2, pp.119-35. Hendershott, P.H. (1997), Uses of equilibrium models in real estate research, Journal of Property Research, Vol. 14 No.1, pp.1-13. Janssen, C.T.L., Jobson, J.D. (1980), On the choice of realtor, Decision Sciences, Vol. 11 No.April, pp.299-311.

Movie Analysis: A Walk to Remember Essay

A Walk To Remember is a romantic movie based on a novel by Nicholas Sparks. It is a 2002 Warner Bros film which starred the 90s pop singer Mandy Moore as the demure, religious, and bookish Jamie Sullivan and punk rock musician Shane West as the popular but rebellious Landon Carter. Directed by Adam Shankman, the story is set in the small town of Beaufort, North Carolina. Landon and his entourage of hooligans have an initiation ritual which, as usual, involved some defiance of authority. One night, after drinking, Landon and his clique trespassed in a cement factory and decided to jump into a pond only in their underwear. While doing their inanities, one of their friends got hurt from jumping off from the cement apparatus. They panicked and got the attention of the security guard so they decided to run away. All of them were able to escape except Landon and his friend who was still unconsciously lying beside the pond. Because he’s still a minor, he’s punishment was doing after-school community service and participating in a school play. Joining the school play got him involved with Jamie Sullivan, the reverend’s daughter who had nothing in common with him. Jamie was dedicated in everything she does and excelled in school. Because of her Baptist upbringing, she often wears the same old and loose sweater and that created an impression of â€Å"oddity† from others. This usual faà §ade of hers made Landon cold and distant from her. At first, he was only using Jamie to help him memorize the lines in the play. But as he spent more time with her, he discovered the real Jamie and realized that she’s far from the person he thought she was. In the final act of the play, he got astounded by Jamie’s beauty as she sang Only Hope with her melodic voice. It was the first time she ever saw Jamie all made up. He got carried away and kissed Jamie even though it was not part of the script. After the play, he tried to be closer to her and to make up for all the offensive things he said and did. But Jamie just kept pushing him away. Not until Langdon’s friends publicly humiliated Jamie in school by placing a picture of her head in body of an indecently dressed woman. This embarrassed Jamie so much. Though he knew it would ruin his relationship  with his friends, Landon took Jamie’s side and defended her. He then gained Jamie’s trust again and Jamie did not avoid him anymore. Landon continued to do special things for Jamie by taking her to a date, buying a new sweater for her, and taking her to special places. Not long after, he started to develop strong feelings for her, something he did not expect to do. But a heart-breaking secret becomes known that puts their relationship to the test, Jamie confessed to Langdon that she had leukemia and had stopped responding to treatments. Despite of this, Langdon still held on with her. He was there when she needed him the most and fulfilled the most important wish in her wish list – to get married in the church where her deceased mother also got married. The actors Shane West and Mandy Moore have chemistry with each other. Both have portrayed their characters well. Mandy Moore’s voice was an asset in the movie. The part where he sang the Only Hope was the most unforgettable and amazing part she did. She’s also the voice behind most of the soundtracks the movie used such us Cry, Lighthouse, and Someday We’ll Know. The musical directors have chosen songs that perfectly fit the scenes in the movie. An example was the part where Landon danced along with her mother and the song was â€Å"Mother, we just can’t get enough† by the New Radicals. The songs are also remarkable that whenever the song Cry is heard, people who have watched would always associate it with the movie. Other soundtracks were also recorded by the Switchfoot band. Another positive thing about the movie is that it did not end with Jamie on the death bed. It just showed Landon watching the sunset smiling and still believing that Jamie is still with him. Like the air, he couldn’t see her, but he could feel her. That created an optimistic ending for the movie. The movie fits all ages. Though it is a romantic film, it is wholesome. Jamie and Landon did not go beyond kissing. It also teaches the audience the true essence of faith, forgiveness, and love. Faith was manifested by Jamie and her father who did not lose their trust in God despite Jamie having leukemia. Forgiveness was also shown when Shane pardoned his friends who  hurt and despised him and his father who left him for another woman. And love was omnipresent all throughout the movie. The reality of death was not a hindrance for Jamie and Landon’s love for each other; it wasn’t a reason to lose their faith in God. Indeed, love never fails. Over all, it’s a must-see movie. It’s a movie for those who wants to know what love is, who wants to be in love, and who are already in love and wants to stay in it. It’s a timeless movie that would surely make one’s heart melt in awe.