Analysis Of The Economic Outlook Of Singapore Economics Essay

Analysis Of The Economic Outlook Of Singapore Economics Essay Introduction The February Issue of the Wall Street Journal has provided an article on the economic outlook of Singapore. The article contains many economic facts and concepts, which could be analysed and discussed. These concepts are derived from theory and provided in the context of Singaporean economy. Economic The first point raised by the authors of the article was that the economy of Singapore experienced recession during 2009 and started recovering in 2010 (Holmes and Venkat, 2010). We remain optimistic about Singapores outlook in 2010 and continue to expect the economy to return to positive growth of 5.1% in 2010, although we reiterate this years recovery is likely to be gradual and uneven (Holmes and Venkat, 2010, p.1). The Singapore economy can be well explained by the economic theory of business cycles. In general the theory suggests that capitalist society is unstable. Economic growth will never continue steadily but will be developing cyclically. Business Cycle Figure 1: Gross Domestic Product of Singapore in $million The theory distinguishes four major types of business cycles which are classified under Kitchin cycles, Juglar cycles, Kuznets cycles and Kondratiev cycles. The economy of Singapore reached its trough in 2009 in Figure 1. All of them have different time spans. Kitchin cycles last from 3 to 5 years (Kitchin, 1923). Juglar business cycle would last from 7 to 11 years. Kuznets cycles would last from 15 to 25 years (Glasner and Cooley, 1997). The longest business cycle is the one described by Kondratiev and Stolper (1935). It is rather considered a technological wave that has a span from 45 to 60 years. The year 2010 started with the contraction or growth phase of the business cycle. The analysis of historical indicators of GDP would allow for identifying at least four business cycles that developed in the period from 1960 to 2010. From Figure 1 it can be observed that the recent economic recession in Singapore was a part of the classic Juglar cycle that lasted from 2000 to 2010. It had a span of a little over than ten years and had a long phase of expansion with rather a short period of slowdown. Prior to this, there was a short Kitchin cycle that lasted from 1998 to 2000. During these three years, the economy went through a trough, recovery, peak and another slowdown. Inflation Rate Figure 2: Annual Inflation Rate in Singapore It is valid to account for the price level and real GDP of the country for the estimation of the business cycle. Real GDP is the nominal GDP deflated by the rate of inflation. High inflation would overestimate the value of GDP and economic growth would be presented higher than it really is. The changes in the annual inflation rate of Singapore are presented in Figure 2. During the years 1998 and 2009 when the economy of Singapore was experiencing recessions, the inflation rate was lower than during the phase of expansion. This observation indicates that inflation is higher when the economy is growing because businesses firstly tend to increase prices and then the output when additional demand appears. During the phase of slowdown, the situation is the opposite. Inflation rates tend to go down and nominal GDP approaches the value of real GDP. Aggregate Demand and Supply The expected economic expansion in Singapore in 2010 can also be explained by the theory of aggregate demand and supply. Generally, when demand (AD) increases, the prices rise and this in turn stimulates producers to increase supply or output (AD). As a result both nominal and real GDP would grow continuously. Figure 3: Aggregate Demand and Supply Model During the recession consumer demand for goods and services was down and therefore both the price level represented by inflation rate was lower and the real GDP declined. In the period of expansion that started in Singapore in 2010 (Holmes and Venkat, 2010), both the inflation and real gross domestic product are expected to increase according to the law of supply and demand. As consumers start spending more money on durable and non-durable goods and services, businesses will increase the prices and start expanding production, which would lead to the growth of total output in both real and nominal terms. This is demonstrated by the supply and demand model in the Figure 3. Price Level and Unemployment Rate It is interesting to note that there is also a relationship between the price level in the country and the unemployment rate. When the inflation (A to B) increases in the country, unemployment rates will go down because inflation is thought to be associated with economic growth and expansion. This relationship is explained by the economic concept of Phillips curve. Figure 4: Long Run Phillips Curve In the long run, however, the Phillips curve will be a vertical line (C) established at the natural rate of unemployment shown in Figure 4. In the case of Singapore, the short term Phillips curve was a valid model to represent the relationship between inflation and unemployment. By July 2009 the unemployment rate reached its maximum while the inflation rate declined, thus supporting the economic concept of Phillips curve shown in Figure 5 and Figure 6. Figure 5: Singapore Unemployment Rate Figure 6: Inflation Rate by Month Interest Rates It is valid to note that aggregate demand was stimulated during the recession by the central banks monetary policy. Without monetary stimulus, it would take much longer for consumers to start spending again and gain confidence in the future. The central bank started lowering the base lending rate (Trading Economics, 2010), which represented the short term interest rates in the country, in order to make it easier for consumers to borrow so that they could start spending more. The dynamics of the short term interest rates in Singapore is shown in the Figure 7. Figure 7: Singapore Interest Rates It is valid to note that in the pre recession period the country had already had rather low interest rates that ranged around 3%. In 2008, the central bank started reducing the overnight lending rate until it reached nearly 0% by 2010 (Trading Economics, 2010; Figure 7). Money Demand The article in the Wall Street Journal states that the expectation of contraction in the Singaporean economy and the 5.1% annual growth are feasible because the central bank does not plan to reduce the overnight lending rate too soon. As a result, there will be stimulus for borrowing, consumer spending and investing. Figure 8: Interest Rate Vs Money Supply The economic theory suggests that there is a direct relationship between the money supply and interest rates as shown in Figure 8. In fact, the interest rates are the price of money or the cost of money. When the cost increases, the demand for money will decrease. Similarly, when interest rates rise (I* to I**), the demand for money will fall. Both the consumers and businesses (S) will start borrowing less (Sloman, 2006). Keynesian View However, different school of economic thought offer different concepts on what would be an effective measure to stimulate the economy. For example, the Keynesian economic school argues that during the period of recession, it is essential to stimulate aggregate demand (AD). This has been seen in the case of Singapore when the central bank started stimulating aggregate demand by loose monetary policy in 2008 2010 (Trading Economics, 2010; Holmes and Venkat, 2010). Figure 9: Keynesian AS/AS Model The Keynesian view is that aggregate demand, if stimulated by monetary and fiscal policy, would eventually lead to the growth of the total output and aggregate supply. However, the neo classical school of economics offers a different solution. The neo economy states that the government should rather stimulate and tackle aggregate supply (Yte to Yrec) rather than demand. One of the measures that this school of economics proposes is to increase the money supply at a constant rate. The expansion of money supply is used to stimulate aggregate supply and economic expansion, thus reducing the volatility of the economy. The governments of developed countries in the European Union and the United States, however, continue to adhere to Keynesian measures of stimulating the economy and fighting recession. This has also been found in the case of Singapore (Holmes and Venkat, 2010). Since the recession had lasted only about a year in Singapore until the contraction and expansion started, Keynesian measures of stimulating the economic growth can be assessed as effective in spite of the criticism from the neo classical economic school. Conclusion It is valid to summarise the main arguments of the discussion of economic concepts in the context of Singapore that were based on the article in the February Issue of the Wall Street Journal. This article defended the position that the economy of Singapore will expand and achieve an impressive growth of up to 5.1% in 2010. This expectation has been discussed in the light of the economic theories of business cycles, the model of aggregate demand and supply and the theory of monetary policy and relationship between the interest rates, money supply and total output. From the standpoints of the theories and the fact that the central bank of Singapore does not plan to change its loose monetary policy, the economic expansion and growth of 5.1% are feasible and can be achieved.

World Hunger

We will often hear of people’s desire to solve world hunger, or to help feed and alleviate the suffering associated with it. However, meaningful long-term alleviation is rooted in the alleviation of poverty, as poverty has always led to hunger. As our efforts have only been directed at providing food, and improving food production or distribution, we then generate the structural root causes that create hunger, poverty and dependency to still remain. Along with this; continuous effort, recourses and energies are given to relieve the pains of hunger in our world. There are many inter-related issues that are the cause of hunger; these are also the same factors that are known to cause poverty. Agricultural practices, war, drought, overfishing and the wasting of food; are some of the many causes of both world hunger and poverty. Because they are connected in a way; solving world hunger becomes hard and nearly impossible to stop. Both hunger and poverty have always led to each other in the end; making the issue uncontrollable and unstoppable. In order for one of these issues to be solved, would require the alleviation of the other; causing a long, endless chain of continuation. Hunger and poverty are very serious issues, and in no way should just be swept under the rug. The amount of food that gets thrown away each day is shocking; and could probably feed 100 people. We don’t do this intentionally; but we waste pounds of food each day, by taking more than what we truly need. World Hunger is something that shouldn’t be such a big problem; but the truth is-it is, it always has been, probably always will be. We’ve got to stand our ground and fight hunger and poverty, cause they can’t do it alone, no one can. We must begin to think a little less about ourselves, and a little more about each other. World hunger and poverty have become very important to me because I have helped out at a homeless shelter, and I have seen the faces of these people; I’ve had the oppertunity to make a connection with them, a connection that most people wouldn’t understand. These people are fighters, you can see it in their eyes. They are survivors of the biggest battle, a battle that they shouldn’t have to fight, a battle that most people don’t even have to think about; and the amazing thing is, they haven’t stopped; their still fighting. They shouldn’t have to do this alone, I am one out of probably a million people who are trying to help them fight this battle; cause I care. All it took was one day, and it has completly changed my life. Seeing all these people, looking into their eyes, feeling their pain; yet seeing a heart full of hope and joy. It has become a life-changing experience that I will never forget. In conclusion, there are a lot of people in our world, with enough food to provide everyone twice a day, yet there are still so many people that are suffering and dying of hunger. We have to face this problem, not turn away from it. I have personally grown to love these people with all my heart, because what they have gone through is truly amazing. They have changed my life forever, and I hope a can help change theirs.

Architecture Architecture And Architecture - 1211 Words

Architecture requires deliberate measurements for practicality and aesthetic appeal. Architecture also requires calculating exact angles and areas of intersection to ensure the components of the structure are stable and safe (By). I decided to explore architecture because I admire art and architecture combines the principles of art and mathematics to construct beautiful buildings. Additionally, many pieces of architecture have a story and through mathematics and art, an architect or the person who commissions the building can tell their stories through a somewhat permanent structure. Architects have to design spaces in a functional manner that is also aesthetically appealing which requires proportion, balance, and conjunction with its surroundings. This report looks at architecture and how trigonometry and mathematics have been used in developing St. Peter’s Basilica and the Pantheon through sectors and right triangle trigonometry. St. Peter’s Basilica is a late Renaiss ance church located in Vatican City built at the place of crucifixion of St. Peter the Emperor Constantine at request of pope St. Slyvester I. It was originally built from 315 A.D. – 349 A.D. but, rebuilt from 1451 A.D. – 1625 A.D. with the dome being designed by Michelangelo. For St. Peter’s Basilica’s dome to remain structurally sound, tension rings were added to the structure and there is an inner and outer dome. Utilizing the sector formula, the dome can be analyzed in how it maintains its structureShow MoreRelatedCommunity Architecture : Architecture And Architecture1695 Words   |  7 Pages What is ‘Community Architecture’? The ‘Community Architecture’ is kind of architectural practice between architects and users. Also, it can be described as architect follow the wish of users or community to design the building fit the requirement by using local materials and helps the residents to build the structure. Royal Institute of British Architects (RIBA) described ‘Community Architecture’ should follow the idea about The aim of community architecture is to improve the quality of the environmentRead MoreArchitecture And Design Of Architecture1753 Words   |  8 PagesArchitecture An architect plans, designs and construct structures. Architects can design many things like a shopping mall, a library, skyscrapers, and so much more. Architecture is a very interesting career that I would like to learn more about. I will be discussing why I chose to research this career and the different types of architects there are, the average annual salary an architect makes, what they do on a daily bases, how much education you need to be an architect, and the pros and cons aboutRead MoreArchitecture Vs. 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For relatively affluent Western countries, the spirit of ‘community building‘ will be how to build a better environment and conditions to make residents feel comfortable, but for non-Western coun tries, ‘community architecture’ often represents public buildings. This dissertation will discuss what is ‘community architecture’, whyRead MoreGothic Architecture : Architecture And Architecture906 Words   |  4 Pagesvery little to do with the architecture that was predominantly used from the twelfth to the sixteenth century. In fact the term â€Å"Gothic† was coined by Renaissance Italians as a derogatory term referring to the Goths or Visigoths who were vanquished by Clovis in the sixth century and left no monumental trace of their invasion and therefore had no influence on what is now remembered as Gothic architecture. 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Brazilians have vastly different architectural styles that are unique to their culture, especially modern styled buildings, utilizing cultural aspects from a mixed background. There are plenty of examples of various architects, fromRead MoreThe Profession of Architecture2117 Words   |  9 PagesWrite an argumentative essay of at least 2000 words on an issue related to the role of the profession of Architecture or Interior Architects The role in architecture in order to combat the possibility of natural disasters is varied when it comes to rebuilding and housing before, after and during the natural disasters. Their essential knowledge and invaluable skills about, building materials, design and attention to detail is imperative in the prevention of damage to buildings. However, unlessRead MoreArchitecture : Online Architecture858 Words   |  4 PagesIn a traditional three-tier architecture is a client-server architecture in a company data center which consists of presentation tier, business logic tier and data tier. Each tier is developed and maintained as an independent tier. Presentation Tier: The Top-most level of the application is the user interface. The main function of the interface is to translate tasks and results to something the user can understand. In simple term, it is a layer which user can access directly such as web-based applicationRead MoreThe Psychology of Architecture Essay1004 Words   |  5 PagesArchitecture is a fascinating business that encompasses the art and science of designing with the construction of buildings. An architect designs all kind of buildings, such as schools, churches, houses, restaurants, and more. This profession has been around since the 1st century CE when Vitruvius, a Roman architect, called it De architectura. Architects have to have a wide range of knowledge. For example they need to have good communications skill, so they can take the information of what a client

The Life and Times of Neil DeGrasse Tyson

Have you heard or seen of  Dr. Neil deGrasse Tyson?   If youre a space and astronomy fan, you almost certainly have run across his work. Dr. Tyson is   the Frederick P. Rose Director of the Hayden Planetarium at the American Museum of Natural History. He is best-known as the host of COSMOS: A Space-Time Odyssey, a 21st-century continuation of Carl Sagans hit science series   COSMOS from the 1980s. Hes also the host and executive producer of StarTalk Radio, a streaming program available online and through such venues as iTunes and Google.   The Life and Times of Neil DeGrasse Tyson Born and raised in New York City, Dr. Tyson realized he wanted to study space science when he was young and had a look through a pair of binoculars at the Moon. At the age of 9, he visited the Hayden Planetarium. There he had his first good look at how the starry sky looked. However, as he has often said when he was growing up, being smart is not on the list of things that gets you respect. He recalled that at that time, African-American boys were expected to be athletes, not scholars. That didnt stop the young Tyson from exploring his dreams of the stars. At 13, he attended summer astronomy camp in the Mojave Desert. There, he could see millions of stars in the clear desert sky. He attended the Bronx High School of Science  and went on to earn a BA in Physics from Harvard. He was a student-athlete at Harvard, rowing on the crew team and was part of the wrestling team. After earning a Masters degree from the University of Texas at Austin, he went home to New York to do his doctoral work at Columbia. He eventually earned his Ph.D. in Astrophysics from Columbia University. As a doctoral student, Tyson wrote his dissertation on the Galactic Bulge. Thats the central region of our galaxy. It contains many older stars as well as a black hole and clouds of gas and dust. He worked as an astrophysicist and research scientist at Princeton University for a time and as a columnist for StarDate magazine. In 1996, Dr. Tyson became the first occupant of the Frederick P. Rose Directorship of the Hayden Planetarium in New York City (the youngest director in the long history of the planetarium). He worked as the project scientist for the planetariums renovation that began in 1997 and founded the department of astrophysics at the museum.   The Pluto Controversy In 2006, Dr. Tyson made news (along with the International Astronomical Union) when  Plutos planetary status was changed to dwarf planet. He has taken an active role in the public debate about the issue, often disagreeing with established planetary scientists about the nomenclature, while agreeing that Pluto is an interesting and unique world in the solar system.    Neil DeGrasse Tysons Astronomy Writing Career Dr. Tyson published the first of a number of books on astronomy and astrophysics in 1988. His research interests include star formation, exploding stars, dwarf galaxies, and the structure of our Milky Way. To conduct his research, he has used telescopes all over the world, as well as the Hubble Space Telescope. Over the years, he has written a number of research papers on these topics.   Dr. Tyson is heavily involved in writing about science for public consumption. He has worked on such books as One Universe: At Home in the Cosmos  (coauthored with Charles Liu and Robert Irion) and a very popular-level book called Just Visiting This Planet. He also wrote Space Chronicles: Facing the Ultimate Frontier, and as well as Death by Black Hole, among other popular books. Dr. Neil deGrasse Tyson is married with two children and resides in New York City. His contributions to the public appreciation of the cosmos were recognized by the International Astronomical Union in their official naming of asteroid 13123 Tyson.   Edited by Carolyn Collins Petersen

The Rwandan Genocide A Perspective Analysis Through Media

Jordon Jones Genocides in Comparative Historical Perspective 01:090:292:01 Professor Douglas Greenberg Final Paper 6 December 2015 The Rwandan Genocide: A Perspective Analysis Through Media â€Å"The Tutsis are collaborators with the Belgian colonists. They stole our land. They whipped us. Now they have come back, these Tutsi rebels. They are murderers. They are cockroaches. Rwanda is our Hutu Land. We must squash the infestation. This is RTLM, Hutu Power Radio. Stay Alert. Watch your neighbors. (Hotel Rwanda).† This is a part of one of the broadcasts Radio Tà ©là ©vision des Milles Collines (RTLM) used to transmit hate propaganda to the state of Rwanda. From October 1993 to late 1994, the RTLM advanced fearmongering ethnic distinctions and misinformation to maintain the climate of fear during the genocide; it defined the Tutsis as enemies and distorted the line between the RPF (Rwandan Patriotic Front) and domestic Tutsis. Essentially, the RTLM was a facilitator of genocide; it was able to create a dehumanizing discourse - a discourse that procured Hutu participation in the mass killings and provided t he legitimacy for Hutu perpetrators to kill the Tutsis and moderate Hutus. But the RTLM not only mobilized the Hutu in an organized and coordinated campaign against the Tutsis, it also mobilizes the conversation about the role media plays in and against any large scale massacre. If the impacts of the RTLM are summed up, it can be said that the radio stations of the RwandanShow MoreRelatedMedia Representation of the Rwandan Genocide1202 Words   |  5 Pagesstatesmanship. Through the example of the Rwanda Genocide my argument is that representation is constitutive of the ways in which we understand the world and of the hierarchy that currently exists within mainstream media. As (Michael J. Shapiro, 1989) discussed ‘The reason for looking at representational practices in relation to texts, language and modes of interpretation is because it is through these practices that ideas about International Relations are produced’. Through the media coverage onRead MoreViolence Is A Form Of Violence1838 Words   |  8 Pagesconcept of violence is genocide. There has been much contest over the definition of genocide, but generally it refers to the intentional destruction of a particular race, ethnicity, religious group, or nationality. Genocide is a form of violence that has plagued history throughout time in both ancient and modern societies—from the Moriori genocide in 1835 to the current day genocide in Darfur. One of the most ambiguous cases of genocide since the Holocaust was the Rwandan genocide, which began in 1994Read More Myth of Propaganda in the Balkans and Rwanda Essay6707 Words   |  27 PagesMass Manipulation and Genocide: The Myth of Propaganda in the Balkans and Rwanda War and conquest have been among the most enduring traits of humankind throughout the ages. While we would all like to believe that we are, by nature, a peaceful species, we still understand there are some things worth fighting for, and given the appropriate context, there are some things worth killing for. As reasoning beings, we hope that if violence is the only option it is for a clear and legitimate purpose.Read MorePolitical Governance in Post-genocide Rwanda2880 Words   |  12 PagesPolitical Governance in Post-genocide Rwanda Critical analysis The Spring Semester of 2014 Political Governance in Post-genocide Rwanda I. 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It took United Nations about 19 months to intervene in the devastating human tragedy that befell Somalia. Furthermore, the Liberian and the Rwanda’s post-cold war conflicts lingered for sometime before the UN respondedRead MoreOne Significant Change That Has Occurred in the World Between 1900 and 2005. Explain the Impact This Change Has Made on Our Lives and Why It Is an Important Change.163893 Words   |  656 PagesE SSAYS ON TWENTIETH-C ENTURY H ISTORY In the series Critical Perspectives on the Past, edited by Susan Porter Benson, Stephen Brier, and Roy Rosenzweig Also in this series: Paula Hamilton and Linda Shopes, eds., Oral History and Public Memories Tiffany Ruby Patterson, Zora Neale Hurston and a History of Southern Life Lisa M. Fine, The Story of Reo Joe: Work, Kin, and Community in Autotown, U.S.A. Van Gosse and Richard Moser, eds., The World the Sixties Made: Politics and Culture

Answer Key Free Essays

Professor Mumford mumford@purdue. edu Econ 360 – Fall 2012 Problem Set 1 Answers True/False (30 points) 1. FALSE If (ai , bi ) : i = 1, 2, . We will write a custom essay sample on Answer Key or any similar topic only for you Order Now . . , n and (xi , yi ) : i = 1, 2,  ·  ·  · , n are sets of n pairs of numbers, then: n n n (ai xi + bi yi ) = i=1 i=1 ai x i + i=1 bi yi 2. FALSE If xi : i = 1, 2, . . . , n is a set of n numbers, then: n n n n n (xi ? x) = ? i=1 n i=1 2 x2 i ? 2? x i=1 xi + i=1 x = ? i=1 2 x2 ? n? 2 x i where x = ? 1 n i=1 xi 3. TRUE If xi : i = 1, 2, . . . , n is a set of n numbers and a is a constant, then: n n a xi = a i=1 n i=1 xi = a n x ? here x = ? 1 n i=1 xi 4. FALSE If X and Y are independent random variables then: E (Y |X) = E (Y ) 1 5. TRUE If {a1 , a2 , . . . , an } are constants and {X1 , X2 , . . . , Xn } are random variables then: n n E i=1 ai X i = i=1 ai E (Xi ) 6. FALSE For a random variable X, let  µ = E (X). The variance of X can be expressed as: V ar(X) = E X 2 ?  µ2 7. TRUE For random variables Y and X, the variance of Y conditional on X = x is given by: V ar(Y |X = x) = E Y 2 |x ? [E (Y |x)]2 8. TRUE An estimator, W , of ? is an unbiased estimator if E (W ) = ? for all possible values of ?. 9. FALSE The central limit theorem states that the average from a random sample for any population (with ? nite variance) when it is standardized, by subtracting the mean and then dividing by the standard deviation, has an asymptotic standard normal distribution. 10. TRUE The law of large numbers states that if X1 , X2 , . . . , Xn are independent, identically distributed random variables with mean  µ, then ? plim Xn =  µ 2 Multiple Choice Questions (a) ceteris paribus (b) correlation (c) causal e? ect (d) independence (20 points) 11. The idea of holding â€Å"all else equal† is known as 12. If our dataset has one observation for every state for the year 2000, then our dataset is (a) cross-sectional data (b) pooled cross-sectional data (c) time series data (d) panel data 13. If our dataset has one observation for every state for the year 2000 and another observation for each state in 2005, then our dataset is (a) cross-sectional data (b) pooled cross-sectional data (c) time series data (d) panel data 14. If our dataset has one observation for the state of Indiana each year from 1950-2005 then our dataset is (a) cross-sectional data (b) pooled cross-sectional data (c) time series data (d) panel data 15. Consider the function f (X, Y ) = (aX + bY )2 . What is (a) 2aX (b) a(aX + bY ) (c) 2a(aX + bY ) (d) a2 X ? f (X,Y ) ? X 3 Long Answer Questions (50 points) 16. The sum of squared deviations (subtracting the average value of x from each observation on x) is the sum of the squared xi minus n times the square of x. There are ? several ways to show this, here is one: n n xi (xi ? x) ? i=1 = i=1 n (xi ? x + x) (xi ? x) ? ? ? n = i=1 n (xi ? x) (xi ? x) + ? ? i=1 n x (xi ? x) ? ? = i=1 (xi ? x)2 + x ? ? i=1 n (xi ? x) ? (xi ? x) = 0, so ? and we know that i=1 n i=1 (xi ? x)2 ? 17. There are several ways to show that this expression equals the sample covariance between x and y, here is one: n n xi (yi ? y ) ? i=1 = i=1 n (xi ? x + x) (yi ? y ) ? ? ? n = i=1 n (xi ? x) (yi ? y ) + x ? ? ? i=1 (yi ? y ) ? = i=1 (xi ? x) (yi ? y ) ? ? 18. Correlation and causation are not always the same thing. (a) A negative correlation means that larger class size is associated with lower test performance. This could be because the relationship is causal meaning that having a larger class size actually hurts student performance. However, there are other reasons we might ? nd a negative relationship. For example, children from more a? uent families might be more likely to attend schools with smaller class sizes, and a? uent children generally score better on standardized tests. Another possibility is that within a school, a principal might assign the better students to smaller classes. Or, some parents might insist that their children are in the smaller classes, and these same parents tend to be more involved in their children’s education. Given the potential for confounding factors such as these, ? ding a negative correlation between class size and test scores is not strong evidence that smaller 4 class sizes actually lead to better performance. Thus, without other information, we cannot draw a meaningful economic conclusions. A correct answer should explain that we should be careful about drawing economic conclusions from simple correlations. (b) The sample correlation between N and T is de? ned as: s rN T = N T sN sT where the sample covariance, sN T , is given by: sN T = 1 999 1000 ? Ni ? N i=1 ? Ti ? T and the sample standard deviations are given by: sN = 1 999 1000 Ni ? N i=1 2 sT = 1 999 1000 ? Ti ? T i=1 2 Note that there are several alternative ways to write this and statistical programs generally use other algorithms to calculate the correlation that are less prone to loss of precision due to roundo? error or storage over? ow. 19. Wage data (a) There are 526 observations. (b) There are 274 men in the sample. This means that the sample is 52. 09 percent male. (c) The average level of education in the sample is 12. 6 years. The median level of education is 12 years. (d) The highest education level in the sample is 18 years of school. 9 people in the sample report having 18 years of education. (e) The average hourly wage in the sample is $5. 90. The median hourly wage in the sample is $4. 65. 20. Fertility data (a) There are 363 women in the sample. (b) The average number of children ever born to a woman in the sample is 2. 3. The median number is 2. (c) The largest number of children ever born to a woman in the sample 7. Six women report having seven children. (d) 25 percent of the sample lived in the eastern United States at age 16. (e) The average level of eduction in the sample is 13. 2 years. 5 How to cite Answer Key, Essay examples

Macroeconomic Patterns And Monetary Policy -Myassignmenthelp.Com

Question: Discuss About The Macroeconomic Patterns And Monetary Policy? Answer: Introducation In the current scenario, a steep fall in the GDP of Australia can be evident in the last two years. Additionally, the increase in the level of unemployment has made it difficult for the Australian Government to manage proper economic balance. The primary reason for the economic downturn in Australia is the downfall in business investment (Tuan, 2012). Moreover, the government budget deficits have become another major issue for the Australian economy. However, Mr. Malcolm Turnbull took several initiatives to cut down government expenditures in all aspects. As a result of the government spending cut down, an unwillingness to invest in the country can be evident after the announcement of the policy. Later on, the Reserve Bank of Australia reduced the cash rate in the country in order to meet the crisis situation and promote business investment in the economy (Reserve Bank of Australia, 2017). It can be seen through the previous data that the Reserve Bank of Australia has kept the offici al cash rate at an historic low level of 1.5 percent for consecutive 13 months. On the basis of the above information, the paper has been developed to answer two major points that are the impact of a fall in the interest rate over the business investment in the nation and the after effect of increase in business investment over the aggregate demand curve, price level and real GDP of the nation. During the period of economic downturn, the Central Banks of most of the nations including different developed as well as developing countries have reduced the benchmark cash rate in order to boost the economic growth and maintain stability in the market. In the same manner, the initiative taken by the Reserve Bank of Australia (RBA) to reduce the cash rate to a historic low of 1.5 percent can be considered as an essential part of the monetary policy of the nation (Reserve Bank of Australia, 2017). According to the Australian Bureau of Statistics (2017), the RBA has trim down the interest rate from 4.25 percent in the year 2012 to 1.5 percent in the year 2016 (Tradingeconomics.com, 2017). On the basis of the interest rate cut in the Australian market, an increase in the flow of money can be seen in the country. A figure has been given below in order to present the previous five years interest rate of Australia for further consideration. Due to the fall in the interest rate, the cost of taking loan will reduce in the Australian market that will enable the entrepreneurs to low interest loans to invest the money in new businesses (Catala?n, Guajardo and Hoffmaister, 2008). Furthermore, the low interest loans will increase the demand for credits that will further leads to increase in the flow of money in the open market. Additionally, the fall in the interest rate leads to a decrease in the return from bank savings (Catala?n, Guajardo and Hoffmaister, 2008). In other words, the interest earned from savings accounts and fixed deposits will decrease due to the fall in the cash rate that will enforce the common public to utilise their money in the form of business investments in place of keeping them in the bank accounts. Hence, it can be seen that the fall in the interest rate leads to increase in the flow of money that promotes business investment in the economy. Furthermore, the fall in the interest rate enables the entrepreneurs to take low interest credits that increase the purchasing power of the consumers. For instance, if an individual gets low interest loans, the price of an asset become cheaper for the buyer (Shaffer, 2017). The buyer has to pay less amount of money as compared to the previous amount with high interest rate. The increase in the purchasing power increases the demand in the market and provides business growth opportunities (Shaffer, 2017). Hence, it can be seen that the fall in the interest rate will increase the aggregate demand in the market due to increase in the purchasing power and enforce the small as well as big entrepreneurs to invest more money in the market. The discussion has revealed that lower rate of benchmark interest rate can increase substantial investments in business in Australia. Assuming the concept, it is required to analyse the impact of increased business investment on aggregated demand curve, Real Gross Domestic Product (GDP), and Price Level in the economy. In the underlying section, the effect of the rise in business investment on the three aforementioned economic aspects has been demonstrated providing a figure. Convincingly, higher business investment due to lower interest rate will certainly increase the monetary flow in the Australian economy. Clearly, higher investment in business will lead to higher income status of the Australian citizens. As a result of the scenario, the purchasing power of the common people will be boosted (Phan, 2014). Evidently, the higher purchasing power of people will mostly contribute towards shift in aggregated demand curve towards the right side. As shown in above figure, the aggregated demand curve will be moved from AD to AD1 pointing to a growth in aggregated demand scenario. Effectively, it can be stated that increase in capital flow and business investment due to lower benchmark interest rate will influence the buying power of the Australian. Hence, the aggregated demand will increase. However, as shown in the above figure, aggregated supply of the economy will be constant in the short-term period at AS. In terms of analysing the effect of higher business investment on Australian GDP, higher aggregated demand will undoubtedly result in an increase in aggregated consumption. Evidently, due rise in consumption of goods and services, the Gross Domestic Product of the economy will be boosted (Scott, Rabanal and Kannan, 2009). As shown in the above figure, the increase in aggregated demand from AD to AD1 has eventually contributed towards increase in the real GDP from Q1 to Q2. For better understanding of the event, another theoretical concept can be demonstrated. Due to rise in flow of capital, common people will receive more money on hand to spend. Hence, rise in aggregated demand will influence higher real GDP of the nation. On the other hand, the impact of the increase business investment on Price Level scenario of the economy will need to be described. According to the theoretical concept of demand and supply, lower benchmark interest rate will mean significant smaller interest on borrowing. Hence, the cost of borrowing will be reduced for the business firms (Cobham, 2015). Inspired by the scenario, the firms will borrow more money from the financial institutions such as banks for business growth and developed. Therefore, the monetary flow in the market will be increased in a massive way. Due to the event, the aggregated price level in Australian economy will significantly show an increase (Fender, 2012). As illustrated in the above figure, an increase in the aggregated demand from AD to AD1 will lead to the rise in the aggregated Price Level of products from P1 to P2. Furthermore, the increased price level can cause rise in inflation as well. The entire analysis has revealed that the decision of the RBA to maintain a lower benchmark interest rate can deliver positive impact on the overall economic status. Certainly, influenced by the lower rate of interest, the firms and business organisations will be encouraged to borrow more money leading towards higher business environment. Apart from that, higher investment in market will provide an increase in the income status of the Australian as well. As an outcome of the scenario, the people will be influenced to spend more and purchase more. Conclusively, the situation will lead to higher aggregated demand, Real Gross Domestic Product, and Price Level of Products in Australian economy. References Catala?n, M., Guajardo, J. and Hoffmaister, A. (2008).Global aging and declining world interest rates. 4th ed. Washington, D.C.: International Monetary Fund, IMF Institute and European Dept. Cobham, D. (2015). Monetary Analysis and Monetary Policy Frameworks: Introduction.The Manchester School, 83, pp.1-4. Fender, J. (2012).Monetary policy. 3rd ed. Chichester, West Sussex: Wiley. Forstater, M. (2016).Economics. 5th ed. London: A. C. Black. Phan, T. (2014). Output Composition of the Monetary Policy Transmission Mechanism: Is Australia Different?.Economic Record, 90(290), pp.382-399. Reserve Bank of Australia. (2017).Cash Rate | RBA. [online] Available at: https://www.rba.gov.au/statistics/cash-rate/ [Accessed Oct. 2017]. Scott, A., Rabanal, P. and Kannan, P. (2009).Macroeconomic Patterns and Monetary Policy in the Run-up to Asset Price Busts. 3rd ed. Washington: International Monetary Fund. Shaffer, L. (2017).Reserve Bank of Australia keeps benchmark rate unchanged at 1.5 percent. [online] CNBC. Available at: https://www.cnbc.com/2017/04/04/reserve-bank-of-australia-keeps-benchmark-rate-unchanged-at-1-5-percent:-reuters.html [Accessed Oct. 2017]. Tradingeconomics.com. (2017).Australia Interest Rate | 1990-2017 | Data | Chart | Calendar | Forecast. [online] Available at: https://tradingeconomics.com/australia/interest-rate [Accessed Oct. 2017]. Tuan, B. (2012). Monetary Policy Surprises and Interest Rates: Evidence from Australia.SSRN Electronic Journal.