business notes - ProsperityHigh consumer confidence...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Prosperity —High consumer confidence, businesses expanding Recession —Cyclical economic contraction lasting for six months or longer Depression —Extended recession Recovery —Declining unemployment, increasing business activity Monetary Policy - government actions to increase or decrease the money supply and change banking policy and interest rates to influence consumer spending. Expansionary monetary policy : Efforts to increase the money supply to reduce costs of borrowing and encourage new investment. Restrictive monetary policy: Efforts to decrease the monetary supply to curb rising prices and overexpansion. •The Federal Reserve System formulates and implements monetary policy. Fiscal Policy - Government actions to influence economic activity through decision about taxes and spending. The Federal Budget - Annual plan for how the government will raise and spend money in the coming year. The primary sources of government funds: Absolute advantage : Country can maintain a monopoly or produce at a lower cost than any competitor. Comparative advantage : Country can supply a product more efficiently and at lower cost than it can supply other goods, compared with other countries. The relocation of business processes to a lower-cost overseas location is offshoring •90% of firms with employees have fewer than 20 people on staff. –98% have fewer than 100 employees. •More than 20 million people in the United States earn business income without employees. –Almost ½ the sales in the United States are made by small business. •Small businesses generate 60% - 80% of new jobs over the last decade. •Launching pad for entrepreneurs and prevalence of minorities.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
1 in 3 businesses closes permanently within two-years.50% of businesses fail after four years. More than 60% of business fail within six years. By the 10-year mark, 82% of all small businesses have closed permanently.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 12/11/2011 for the course PSYCHLOGY 101 taught by Professor Staff during the Spring '08 term at Rutgers.

Page1 / 3

business notes - ProsperityHigh consumer confidence...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online