Fundamentals of Macroeconomics
Fundamentals of Macroeconomics
David Wagner
Eco/372
Jeffery Allen
01/2/13
There are many different factors, which play apart in supply and demand. I will now explain a few of the key factor that play the biggest role. There are the decrease of taxes, purchase of groceries or goods, and massive layoffs of employees. These three factors can change the demand of goods and the price offs goods. This can also decide how many goods are made. I will now explain how each factor plays its roll in detail.
The decrease of taxes means the government has less spending money. This means more debt for the government that they cannot handle. The decrease in taxes also makes the regular citizens more independent and less dependent on the government. When the people don’t have to pay high taxes, the more disposable income they have, this allows for people to spend more money. When people spend more money, this will help out business, because people are more inclined to spend more money. So everything will work hand in hand, less power for the government and more money saved and spent. This allows for business to boom and pick back up, the result will be a better economy. The better the economy is means less rules and regulations, and problems. The more jobs that become available will mean less debt in general.
Massive layoffs people tons of people out of jobs, this allows for the unemployed to make money. Businesses do benefit from this as well as hurt from this. A business may down size and save money, they lay people off do to out sourcing. When a business uses out sourcing, they save and make more money, because the cost of products to be made and labor fees are cheaper. Business will loose from this, because they products are not made with quality, and or they are not making any profit and are closing their doors. So in the long wrong a business may be filing for bankruptcy. Massive layoffs are good and bad for the government in many ways. The government likes this because; more people will be more reliant on them, meaning that they need them to make money. Once unemployed, people