2008 Economic Crisis

It is because sometimes market fails to satisfy the needs of the consumers.So in that case we call it market failure.so therefore government needs fto intervene in order to keep the economy up the great standards,like in SA it is always the case for inflation to rise everyday wonder why?

AIG

High unemployment was an effect of the Great Recession.

If resources are easily accessible for countries, they can trade these resources for other resources or goods they don't have. Resource surpluses can also be sold for a profit to other countries.

Is that the income levied on individual earnings.

The relationship between production and cost in any manufacturing process varies based on volume produced and whether any part of the manufacturing process is outsourced or performed by subcontractors. Additionally, production and cost ratios vary based on the amount of automation involved in production and the amount of human oversight and involvement required.

Because of many factors that are occurring in a simultaneous fashion. The crucial ones are:

1. Due to Risk Aversion on the part of Currency Investors, the Demand for the US Dollar has gone up world over

2. Uncertain Economic Situation around the globe

3. FII's turning Net-Sellers and withdrawing funds from the Indian Market

All countries across the globe are affected by this economic crisis. The ones that are worst hit are United States (USA), United Kingdom (UK), Germany, Japan, Brazil etc.

The economic crisis is believed to have originated from the USA but since they are the largest economy in the world and almost all countries are interrelated to one another the effect spread to all nations

Domestic output, and employment falls

There are several reasons but an obvious one is the lack of investment in the pound by foreign investors. Foreign investors in British banks will expect a return on their money. This is the 'interest rate' that we hear of. Interest rates have a double effect. If they are low, then borrowing is cheaper, people will therefore spend more as they can afford to borrow more, and more people will be kept in work (such as shopkeepers and manufacturers) as a result, thus minimising, as far as possible, the effects of the recession. However, savers will get less interest on their money. If interest rates are high, people will save more as they will get a better return on their investments, but those who borrow money - like most businesses - will find their costs increasing because they have to pay more interest. Therefore they put their prices up to cope, and so inflation - where prices increase and increase year on year - will become a problem. In the present (2009) recession, the Bank of England decided to lower interest rates to such a low amount (the lowest almost in history) therefore helping those who borrow money - like businesses and mortgage payers - and hopefully persuade people to buy more so that fewer traders go out of business and unemployment does not escalate out of control. This means that foreign investors will not invest in pounds because they can get a better rate of interest elsewhere, say, in the Eurozone countries or in the USA. Because of this lack of demand for the pound, its value falls, just as any other commodity would do. A low pound is not necessarily a bad thing. Although it makes imports more expensive as a weaker pound buys less, and foreign holidays are more expensive, the weak pound encourages us to buy British wherever we can, something which is really necessary in a recession to keep our own people in work, and also makes our goods much cheaper to sell abroad - which is again good for exports and the economy. In Harold Wilson's time as prime minister in the 60s, during another bad economic spell, rather than use interest rates, he actually devalued the pound overnight, delaring it worth less the next day. This had the same effect of increasing exports and encoouragiing us to buy more to avoid mass unemployment. There are those who believe that if Britain was in the Eurozone countries it would be better off, but this is not the case, even if the pound becomes the same value (or less) than the Euro. The reason for this is simple. In Europe, the interest rates are governed centrally in a 'one-size-fits-all' system. This means that countries like Greece, Portugal, Ireland and Spain (that are having real problems within this recession), will not be able to control unemployment and lack of spending and so on, as they are all linked to the central European interest rate, and couldn't lower it, or devalue even if their country neared ruin. They will be far worse off during the recession as will Britain as here we have the luxury, being outside of the Euro, of being able to set our own interest rates, and control our own path through the recession without being beholden to anyone else.

banks invest money in the stock market, stock market crached, so did the banks

Cerberus was a mythological creature. a Dog like monster with three heads whom lived in the underworld.

•Depression /Slump - expected to find heavy unemployment,a low level of demand and capital utilization.Profits will be low as will business confidence. •Recovery - the upswing of the trade cycle is characterized by expanding production , the replacement of old machinery,rising consumers' expenditure and increasing profits •Inflation /Recession is the downswing of the trade cycle . This is where falling consumption, decreasing profits and expectations and rising stocks of unsold goods will be characterized in this stage. •Boom - Expectations are high , profits are high and prices will be rising rapidly .Investment will also be high but labor will be short supply

When output falls for at least 2 quarters.

France become more powerful, but it make the middle and peasant to pay tax and the noble didn't have too. it also lead to the fall of Louis XIV

may be satyam

Some things that happen during a financial crisis are

1. Banks incur huge losses. Their earnings came down.

2. The housing prices plummet

3. The liquidity in the financial system comes down

4. High unemployment

5. High inflation

etc.

I don't think this is rocket science. A country with high rate of crime is likely to attract less tourists because they would be concerned about their security. Countries ypt which rely heavily on the tourism revenues are serious about the security of people visiting them, For example There is special Tourist Police in Egypt.

Quite recently the tourist activity in the troubled areas of Pakistan has come to a halt which is costing the country.

Anis Shiekh

Time, jobs, money, diamond, water

the common examples of monopolistic competition are foods,clothes,newspaper
etc

The Subprime Crisis is an economic problem that happened in the United States. It cannot be explained in a paragraph or so. In short, it happened due to uncontrolled lending in the US Financial Markets.

Some of the reasons for this crisis are:

1. The US Real estate market crash

2. High default rates on Subprime loans &

3. Subprime Mortgage backed securities

Characteristics of Business Cycle:

The fluctuations are wave like movement and are recurrent in nature.

Business Cycle is characterized by waves of expansion and contraction. But these are not only two phases of business cycle. There are four phase of business cycle - Expansion, Recession, Contraction and Revival or Recovery.

The movement from peak to trough and again though to peak is not symmetrical. According to Keynes, prosperity phase of business cycle comes to end fast but dip is gradual and slow.

Business Cycle is self generating. Every phase has germs of the next phase, that is, expansion has the germs of the recession in it.

In this chapter we learnt about business cycle and its characters and definition. However, we already have studied about marginal efficiency of capital and investment in business by this blog. Business cycles are everything which determines your business objectives.

}The Burden of Debt- Louis XIV had left France In a horrific debt. Then the Sevens Years" war and the American Revolution started. Since the war broke out the cost of everything was exspensive.To cover-up the expenses the government borrowed more money.