Question

In: Economics

Assume you are and econmic advisor for the future president. She tells you that unemployment is...

Assume you are and econmic advisor for the future president. She tells you that unemployment is at high levels and GDP growth is at .5%. She asks you to adress the following.

a.) What is a possible cause of the econmic condition?

b.) How can we solve the unemployment problem and biost the economy?

Solutions

Expert Solution

Answer A--Possible cause of economic condition-

1.The possible condition of economic slowdown can be the rise in the interest rate.

2.Due to trade war with countries also declines the economic growth of country.

3.Lesser investments,it is the reason of declines in the economic growth because the less investment will leads to less development of countries infrastructure.

4.Restrictions and barriers of trade for foreign countries,it will lead to decline in economic growth because restrictions or barriers on trade demotivated the foreign companies to set up the business in these type of countries.

5.Falling in exports also declines the economic growth of the countries, falling in imports will results in economic growth while falling in exports will results in decline of economic growth.

6.Falling in Tax revenues also declines the economic growth,tax revenues boost the government to take finanicial decisions but when there will fall in tax revenues it will create a little burden for government to take economic decisions.

7.High retail and food inflation also declines the economy slowdown or growth.

8.Ineqality of income among the peoples of the country leads to less economic growth,unequality of income is just like racism for the economic growth.

Answer B--The unemployment problem and boost in economy possible only if--

1.Change in industrial technique- There is two type of production technique ,one is labour intensive in which human beings are used to participate in the production of goods and services another one is capital intensive technique which results in reduction of human resources from the production process of goods and services so we should encourage the labour intensiive technique to reduce the unemployment .

2.Chane in Education system - By the development of more vocational courses ,we should focus on practical knowledge instead of more theoritical knowledge, by which efficiency in work will increase and it will also reduce the unemployment rate.

3.Set up of new industries--Set up new production processing industries will reduce the unemploment.

4.Most assistance to self employed people.

5.Control in population growth,it will leads to increase in employment rate.


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