Assignment:
Growth: Economic Analysis
Preparation
This assignment examines national economics, economic growth, and financial crisis. There are four parts to this assignment. Please be sure you have completed all four parts before submitting.
Requirements
Part I
Consider a nation in which the volume of goods and services is growing by 5 percent per year:
• Analyze the impact of the high rate of growth on the nation.
o Predict how the high rate of growth might affect the power and influence of the national government relative to other nations experiencing slower rates of growth.
o Predict how the 5 percent growth might affect living standards in the nation.
How does economic growth affect population growth?
Will living standards necessarily grow by 5 percent, given population growth?
Part II
• Use the concepts of gross investment and net investment to explain the differences between an economy that has a rising stock of capital and one that has a falling stock of capital.
• Explain how it is impossible for gross investment to be less than zero, even though net investment can be positive, negative, or zero. What real-world examples can you provide?
Part III
• Analyze the economic disparities among countries.
o Explain why some countries are much poorer than other countries.
o Based on what you know and have learned about macroeconomic principles, are poorer countries destined to always be poorer than wealthy countries? If so, explain why.
If not, explain how poorer countries can catch up to or even surpass wealthy countries.
Part IV
• Explain how, in general, a financial crisis can lead to a recession.
• Explain how, in general, a major new invention can lead to an economic expansion. Organize your assignment logically with appropriate headings and subheadings.
Additional Requirements
• Include a title page and reference page.
• Include 3 to 4 pages, not counting title page and reference page.
• Use at least three scholarly or professional resources.
• Use APA format for citations and references.
• Set your assignment in Times New Roman, 12 pt., double spaced.