Question

1) Are individuals in the United States “better off ” economically now than they were at the beginning of the twenty-first century? Why?

2) Obtain several recent issues of The Wall Street Journal or Bloomberg Businessweek. Identify, read, and be discuss at least one article relating to one of the six principles of finance. Cite the date and name

of the article.

3) Some economists believe that an increase in the money supply will lead to inflation. Do you agree?

4) Given the current health and financial crisis, should the government simply print more money to bail out businesses and individuals?

Answer 1

                                                The concept of economic well being is the product of various economical factors that affects the individual. It could include factors like income, which includes annual income which refers to the salary potential and GDP per capita related income which defines the relative income comparison; GDP of a nation, opportunities available in the market for jobs etc. The end of the 20th century was characterised by the idea of globalisation which had a huge impact in the 21st century world economy. The world is now considered as a single large market where trade volumes have been increased and nations are making relative advantages in the domestic market and also in maintaining the economic well being of its people. Now let us analyse certain facts and statistics of the US economy which can be analysed so that the economical well being of its people over the 21st century can be compared

· The GDP of Unites States was about $12 trillion at the beginning of the 21st century and now it has been raised to almost a $22 trillion economy

· The GDP per capita of it people ranged around $37,000 at the beginning of the 21st century whereas it is now about $65,000.

· The median household income of the US was about $43,000 at around 2001-2002 whereas it is around $64,000 today where it ranges from almost $12,000 to $3,80,000

· The average annual spending today in the US economy is about $61,000 whereas it was about $39.000 at the beginning of the 21st century.

· The average annual spending on health was about $5035 per capita at around 2001 whereas it is now around $11,500 per capita.

· America has the highest average household income among the OECD nations today

· It is ranked among the top 50 nations having high values of income inequality across the world. The statistics states that the top 1% of wealthy people owned about 10% of the whole wealth at the beginning of 21st century and it has been raised to almost 17% today.

All the above statistics are measures to identify the economic well-being of the people and the comparison statistics can be studied to identify how well the economic well being have undergone changes from the beginning of the 21st century till date. The following conclusions can be drawn from the above statistics

· The GDP and GDP per capita have improved on a large scale over the years, which states that the production of the nation is competent with the increasing population of the nation and also the economy is stable so as to increase the income from the produce. Thus, the products are available to the people at their needs.

· The average income has also improved over the years which states that its citizens are being provided with right amount of salaries for their spending so as to maintain their economic and social well-being.

· The consumer spending has also improved on a proportional basis. Thus, there are no barriers for a consumer demand to be met in the system.

· The average spending on health has increased, but when compared to the improvements made in annual incomes, it is relatively low. Thus, the people have more money to spend on other items owing to developments and policies that have been made in the health sector over the years.

· The income inequality has seen a considerable increase which would have a detrimental effect on the economic well being of the lower sections of the society.

                                           Thus, it can be concluded that the economic well being have been improved over the years. But with rising economic inequality and increased financial crisis have remained a huge obstacle in its path.