Public Administration - Municipal BUS400 Lecture Notes - Lecture 4: Incomes Policy

23 views3 pages

greenmuskrat329

28 Dec 2017

School

Seneca College

Department

Public Administration - Municipal

Course

Public Administration - Municipal BUS400

Professor

Alan Bastian

For unlimited access to Class Notes, a Class+ subscription is required.

Document Summary

Macroeconomic policy: action taken by the government to achieve economic objectives . Importance of macroeconomics: monetary policy: action taken by the central bank to, incomes policy: action taken by the government to change the supply of money and the rate of interest. control wages and prices. Usefulness of macro to business decision making: macroeconomic variables could affect the profits of firms. When the economy is growing, the demand for its. When the economy is declining, the demand for goods and services is high. goods and services is low. Households: assumed to maximize satisfaction, sell labour services and other resources to firms, invest in firms by purchasing stocks and lend to firms, some work for governments, some purchase government bonds. by buying bonds. Households: and governments: receive wages, rent, interest, and dividends from firms, some receive transfer payments, transfer payments: payments that do not represent, pay taxes to the government. compensation for goods and services.

Related Questions

What is the market for factors of production?

What is the market for factors of production?
1. The market for factors of production is where households and firms interact to trade factors of production for factor payments. For example this is where people provide firms with labor and firms pay them with wages.
What is the money market?
1. The money market is where households, firms, and the government may save and/or invest their money to earn interests. Money market includes banks, stock market, bonds market, and other financial institutions where economic actors can buy and sell financial assets to earn interests and/or dividends.
Who are the three economic actors in the circular flow model?
1. In a circular flow model, the three main economic actors are the households, firms, and the government. Households include the typical individual consumers. Firms include businesses and similar producers in the economy. Finally, the government refers to the whole government system from federal to local level.
How is the national income of an economy determined?
1. The national income of an economy is determined by measuring the total value of the output produced in an economy or the total income earned by the actors in the economy. In a circular flow model, we can see that the value of total output produced should equal the total value of income generated and earned in the economy. This is because every dollar spent by someone in the economy is received by another person in the economy as income.
What is GDP?
1. The gross domestic product or GDP represents the sum total of the value of the final goods and services produced within the economy for a given year. It is the most commonly used measure of its economy’s productivity and income.

Our last discussion question for this course is a fitting one since it seeks to cap off this introductory look at the macro. by assessing the relevant theory that has been developed to date. As your text indicates, there are two broad schools of macroeconomic thought that have been competing for the public mind over the last few decades. The Keynesian, or Mainstream view, sees the economy as being prone to shocks, and is concerned primarily with achieving full employment, and seeks to use government intervention (primarily activist fiscal policy) at boosting aggregate demand to achieve that objective. The Classical School (including the Monetarist branch of that school) sees the economy as being mostly self-correcting, and is more concerned with macroeconomic stability particularly price stability, and prefers monetary policy over fiscal policy in achieving this goal. Although there has been a fair amount of consensus as to some of the major items of analysis, there still remain some controversies, particularly with regard to whether government policy is even effective at managing the macroeconomy. What do you think of these divergent views as to government policy? Has one side of this debate won the majority of the argument here, or do both sides have points in their favor? In either case, though, are there times when one set of theories is called for, and then times when the other is?

greenmole602

Chapter 1 question 5, page 17
#5
(Micro Versus Macro) determine whether each of the following is primarily a microeconomic or a macroeconomic issue:
a. What price to charge for an automobile
b. Measuring the impact of tax policies on total consumer spending in the economy
c. A household's decision regarding how much to work each week
d. Designing a government policy to increase total employment
Chapter 1 question 11, page 18
#11
(marginal Analysis) the owner of a small pizzeria is deciding whether to increase the radius of the delivery area by one mile. What considerations must be taken into account if such a decision is to increase profitability?
Chapter 3 question 12, page 68
#12
( Objectives of the economic decision-makers) In economic analysis, what are the assumed objectives of householdâs, firms, and the government?
Chapter 3 question 15, page 69
#15
(Evolution of the household) Determine whether each of the following would increase or decrease the opportunity costs for mothers who choose not to work outside the home. Explain your answer.
a. Higher levels of education for women
b. Higher unemployment rates for women
c. Higher average pay levels for women
d. Lower demand for labor in industries that traditionally employ large numbers of women

jadeturtle271

Public Administration - Municipal BUS400 Lecture Notes - Lecture 4: Incomes Policy

Document Summary

Get access

Related Documents

Business Administration - Accounting & Financial Planning ECN502 Lecture Notes - Lecture 4: Incomes Policy, Monetary Policy

ECON 102 Lecture Notes - Lecture 8: Loanable Funds, Equation, Exogeny

ECON102 Final: Final Exam Study Guide

Related Questions