The Multiplier: Macro Writing Assignment

The Multiplier
The Multiplier

Get a Custom Essay Paper that meets your expectations by clicking ORDER

The Multiplier

Read this short article from the December 10, 2020 edition of The Economist: How much economic stimulus does America actually need? In the second-to-last paragraph, the author points out that the fiscal multiplier during the pandemic was only about 0.6. You may have noticed that a value of 0.6 is much smaller than any multiplier you have computed in this class.

Define the term multiplier and explain, in detail, how it is computed.

Provide an example where you take the reader through a few ‘rounds’ of additional spending generating additional income, and that income causing more consumption spending, etcetera.

Then explain why the multiplier will be smaller if people saved rather than spent their stimulus checks.

In your answer, be sure to define any economic terminology you employ.

Get a Custom Essay Paper that meets your expectations by clicking ORDER

Economic macroeconomic schools of thought in the US today

Economic macroeconomic schools of thought in the US today
Economic macroeconomic schools of thought in the US today

Want help to write your Essay or Assignments? Click here

Economic macroeconomic schools of thought in the US today

Please read essay attached and answer the two questions below in 1000 words with 2 bibliographical resources. 

Cambridge economists: The art and science of economics at Cambridge  From the print edition | Christmas Specials Dec 24th 2016,

What are the major components of economic macroeconomic schools of thought in the US today? (Hint: Chicago School, Keynesian, Neo Keynesian, Neo Classical, Supply Side, Trickle Down, Libertarian, Austrian School, Other?) 

How do they differ from or compare to the Cambridge School?

Below is a partial answer to the above homework questions by one of our writers. If you are interested in a custom non plagiarized top quality answer, click order now to place your order.

Major components of economic macroeconomic schools of thought in the US today

Chicago School

The Chicago school of macroeconomics is a sub-branch of the Neo-classical school of economic thought albeit with a few divergent views. The school of thought developed from intense discussions by Professors in the University of Chicago, whose ideas were mainly price based. The main identifying component of the Chicago style of macroeconomics is the preference for the monetarist theory as opposed to the Keynesian approach.

However, as with all other schools, the development of economic theory in the 20th century brought a mix of ideas from both the saltwater and freshwater schools (Ebeling, 2006). A case example for the Chicago school of macroeconomic thought is the adoption of concepts of rational expectations, sticky wages, and imperfect competition. Notable mentions from the Chicago school include Eugene Fama, Milton Friedman, and Lars Peter Hansen.

Keynesian economics

The Keynesian school of macroeconomic thought bases its theories on the works of John Maynard Keynes. The main proposition by Keynesian economists is the need for government intervention to manage the business cycle. The Keynesian school of thought is a major proponent of the aggregate demand approach of macroeconomic evaluation. The concepts of sticky wages and imperfect competition represent rigidities in the macroeconomic system for which the Keynesian economists attribute the failure to streamline the system of supply and demand through fiscal and monetary policy (Evans & Makepeace, 1979, pp. 40 – 43).

Neo Keynesian

The neo Keynesian school of macroeconomics is a post-war attempt at synthesizing the ideologies of John M. Keynes and the neo classical approach to macroeconomic theory. The fusion of market control, supply and demand, and rational choice theory came together to provide the foundations of the neo-Keynesian economics. The neo Keynesian approach began taking shape after monetarist economists cast doubts on the Keynesian theories.

The neo Keynesian approach then resulted from finding a middle ground between the Keynesian and Monetarist approaches to the analysis of the macroeconomic environment. The result of these studies was the development of the neo classical synthesis, which gave rise to the IS-LM model and the Philips curve (Arestis, 1992; Lavoie, 2014).


The neo classical economic school of thought is a collection of economists, whose ideas revolve around the exchange of goods through the assessment of outputs, and the distribution of factors through market supply and demand. The neoclassical model makes three key assumptions: rational preferences among consumers, maximization of utility and profits for consumers and producers respectively, and independent activities of consumers based on perfect information.

Varying scholars contest on a number of issues surrounding neo classical school of economics. First is the dominance of either marginalism or utility, second is whether the approach is a radical change from classical economics or simply a continuing development of ideas, and third, the numerous ideologies and differences between views and approaches aggregated into the classical approach (Weintraub, 1993; Hansen & Ohanian, 2016).

Economic macroeconomic schools of thought in the US today

Want help to write your Essay or Assignments? Click here

Concrete vs. Virtual Manipulatives

Concrete vs. Virtual Manipulatives
Concrete vs. Virtual Manipulatives

We can write this or a similar paper for you! Simply fill the order form!

Concrete vs. Virtual Manipulatives


Concrete vs. Virtual Manipulatives. After completing the readings from the online articles Manipulatives: The Missing Link in High School Math (Curtain-Phillips, n.d.) and “Concrete” Manipulatives, Concrete Ideas (Clements, 1999) compare and contrast the use of concrete manipulatives and virtual manipulatives in math instruction.

Part 1

• Discuss your experiences, if any, with using manipulatives in your own classroom.

• What are the pros and cons for using each (concrete manipulatives and virtual manipulatives)?

• Discuss an instance where you would use a virtual manipulative over a concrete manipulative and vice versa.

Submit two to three paragraphs in response in your post to the class Discussion Board.In addition, view the online resources pages 400 and 432 in our Van de Walle et al. (2013) text.

Part 2

• Select one resource to investigate further.

o Give a brief summary (1-2 paragraphs) of the resource.

o How can this resource be utilized in a math classroom?

o Post your 2-3 paragraph response in the class Discussion Board.

Below is a partial answer to the above homework questions by one of our writers. If you are interested in a custom non plagiarized top quality answer, click order now to place your order.

Concrete vs. Virtual Manipulatives Essay

Concrete vs. Virtual Manipulatives Essay: The class discussion revolves around measuring of objects and if the given explanations will match the length, weight, volume, area, time and angle. It considers to what extent the recommended sequence of instruction for the measurement reflects in the curriculum material.

Some of the activities undertaken involve making of shapes using two different shapes particularly two pieces made by combining two triangles. The differences or similarities in the shapes formed are observed. Activities also involved exploring area relationship and having an understanding of how to measure shapes with the use of measuring tools, one only needs to understand the relationship of side lengths and the number of side lengths that are exposed. The invention of area formulas was also part of activities that were carried out. Area formulas were invented by use of enlarged copies, use of paper cutting and folding the two-dimensional figures to with the help of the defined technique.

Advantages of concrete manipulative

Concrete manipulative is simple to form and easy to move around, it improves the creativity of students when selecting attributes and corresponding units, students possess more control on the work they do, and the process can be traced back for reference. Concrete manipulative gives an opportunity for trial and error, students can openly observe the units used, it is easier to compare to the real-life situation and cheap as it does not require any use of…

We can write this or a similar paper for you! Simply fill the order form!

Irish GDP GROWTH using the Production Function

Irish GDP GROWTH using the Production Function
Irish GDP GROWTH using the Production Function

Want help to write your Essay or Assignments? Click here

Irish GDP GROWTH using the Production Function

Calculate Irish GDP GROWTH  Using the Production Function

Following is the data for Ireland for 2003-2004.  Assuming the Cobb-Douglas Production Function* of the form Y(GDP) = AKalphaL(1-alpha), calculate the Total Factor Productivity growth rate for 2004________.(The Per Cent Change from 2003).   Year GDP in 2000 prices (millions of Euro) K Gross Fixed Capital Stock (millions of Euro) L Total Hours Worked (millions) Share of Labor in GDP 2003 111,255 142,310 2,855 0.522 2004 116,729 149,178 2,903 0.526
To get full credit, you must show your calculation steps. (Use Logs) Y(GDP) = AKalphaL(1-alpha),  HINT          Y=A*K( ^alpha) * L^(1-alpha) 

HINT Step 1    A= Y/K*L^ (1-alpha) 

                        Log A= Log Y- alpha log K – (1- alpha) log L

We can write this or a similar paper for you! Simply fill the order form!

The Economic Order Quantity (EOQ)

The Economic Order Quantity (EOQ)
The Economic Order Quantity (EOQ)

Want help to write your Essay or Assignments? Click here

The Economic Order Quantity (EOQ)


The Economic Order Quantity is that quantity that results in minimal costs in terms of holding costs for a particular period. The EOQ provides a good measure for calculating the optimal stock quantity required.

1a).EOQ = √2 (Annual Usage in Units) (Order Costs)/ (Annual Carrying Cost per Unit)

EOQ = √2 (CoD/Ch

Where Co = Cost of Placing Order = £2

D = Annual demand = 20,000

Ch = Cost of holding one item for a year = £1.5

            EOQ = √2 (2×20, 000/1.5

EOQ =230.94

1b). The implications of holding stock occur when stock outs are registered before the delivery of new orders. The shortage experienced causes delay for customer’s orders who eventually search for reliable suppliers. Alternatively excessive stocks lead to dead stock and holding of capital in stock instead of being utilized in other operations that can be more productive for the company. The above implications above compel the company to identify the right Economical Order Quantity to maintain (Doupnik and Perera 2012)

Want help to write your Essay or Assignments? Click here

2. a)

Cash flow Forecast for UniFood 2016
Credit Sales200030003000400040003000200010001000500060004000
Capital Amounting10000           
Total Receipts (A)300002100025000260003000023000120001100028000330003400029000
Cash Pymts to supplier200025003000300030001500150020003000300030002500
Cr pymts to supplier600065007000400060002000100020006000700070006000
Delivery Cost100012001500100120090080010001000150015001200
Rent and rates40000           
Insurance         960  
General expenses303030303030303030303030
Bank Loan100010001000100010001000100010001000100010001000
Vehicle Running200200200200200150100150200200200100
Vehicle Tax250           
Total Payments (B)585401950020800163901949013590124701424019300217602080018880
Net In/Out Flow (A-B)-28540150042009610105109410-470-32408700112401320010120
Opening Balance5000-23540-22040-17840-8230228011690112207980166802792041120
Closing Balance-23540-22040-17840-823022801169011220798016680279204112051240

2b) The months that will experience cash shortage are January, February, March and April.

2c) The cause of the cash shortage is that the business capital is insufficient to pay all the initial costs of operating the business. The credit sales are also contributing to the shortage of cash. The rental charges are also very high (Doupnik, Hoyle and Schaefer 2012).

Want help to write your Essay or Assignments? Click here

2d) To improve the Cash Flow Unifoods should apply for some low cost financing from a convenient bank that can advance a soft loan of £23540 or source for funding from an alternative source to facilitate the business operations during the first four months of the year. Unifoods may also opt to shop for cheaper premises that are within the same locality but which have the same goodwill or advantages as their present premises (Vance 2003).

4a) i.

Project AProject B
Payback period1 year and 6 months.1 year and 7 months

The Payback Period for project A is one year six months while the payback period for Project B one year seven months (Hermanson, Edwards & Invacevich, 2011)

4b) ii.

Unifood Accounting Rate of Return
Project AProject B
0100,000 100,000 
160,000 60,000 
280,000 70,000 
390,000 80,000 
4100,000 90,000 
5100,000 95,000 
Total530,000 495,000 
 Less 100,000430%Less 100,000 395%
ARRAverage annual returns/Initial inv

The ARR for project A is 430% while the ARR for Project 395% (Bodie, Kane & Marcus 2008).

4c)  iii.

Project  A      Project B
YearCash flowCash flow
 Discount Rate 10.00% 10.00%
PV for future cash flows$318,672.97$292,960.61

The NPV for project A is $218672.97 while the NPV for Project B 192960.61 (Brealey, Myers & Allen 2005).


The best project to invest in is project A. The payback period for the first project is shorter. The Accounting rate of return is 430% which is also higher than that of project B. The NPV for Project A is also higher than that of project B. The NPV for project A is £218,672.97 while that of project b is £192,960.61 (McLaney 2003). The other factors which should also be considered are the other extra expenses like the preliminary expenses. It may be costly to commence trading on some projects hence all the total costs should be considered (Harrington 2003).

Want help to write your Essay or Assignments? Click here


The Gross Profit Margin for Unifood is 65.76% while the Net Profit Margin is 15.31%. The total costs for the project would amount to 84.69%. The profitability ratios for Unifood are good and above average. The total costs are a little high but they can be brought down by strategically moving to cheaper premises. The efficiency ratios for Unifood are: Average collection Period Days in a Year/Inventory Turnover. To obtain the turnover the average stocks have to be obtained and which are not available (Helfert 2007).

DateTotals  Analysis   
Credit Sales38000  12.58%    
Capital Amounting10000      
Total Receipts (A)302000 302,000    
Cash Pymts to supplier30000      
Cr pymts to supplier60500      
Delivery Cost12900 103400    
Gross Profit  198,60065.7616(Gross Profit Margin)  
Rent and rates40000      
General expenses360      
Bank Loan12000      
Vehicle Running2100      
Vehicle Tax250      
Total Costs255760 25576084.6887   
Net In/Out Flow (A-B)46240  15.3113(Net Profit Margin)  
Opening Balance52240      
Closing Balance98480      

The credit sales are only 12.6% of the total sales which represent a low rate of credit sales. Unifood needs to provide flexible credit terms to encourage more sales to improve its profitability.

To increase the working capital, Unifood should cut down on its revenue costs. For example, Unifood should look for a way to reduce its rental income which is very high (Fridson 2002).The wages are also very high the company should find a way of reducing the high wages (Samuels et al 1998). Unifood has also to negotiate with the suppliers to provide more favorable credit terms to facilitate increased purchases and trade.\

Want help to write your Essay or Assignments? Click here

To conclude the Economical Order Quantity has provided an accurate way of determining the optimal stock level that a company should maintain having in mind the annual demand of the company and the holding costs that the company incurs in cases of overstocking and the costs of placing an order. The analysis of the company indicates that the financial performance of unifood is good as it is making profits and the suppliers are paid on time while the debtors are also maintained are reasonably low levels.


Bodie, Z., Kane, A., & Marcus, A. J., 2008, Investments (7th International ed) Boston: McGraw-Hill. 303.

Brealey, R.A, Myers, S. C., Allen, F., 2005, .Principles of Corporate Finance Boston: McGraw-Hill/Irwin.

Fridson, M., 2002, Financial Statement Analysis: A Practitioner’s Guide. New York: John Wiley.

Harrington, D, R., 2003, Corporate Financial Analysis: Decisions in a Global Environment. 4th ed. Chicago: Richard D. Irwin, Inc.

Helfert, E, A., 2007, Techniques of Financial Analysis: A Modern Approach. 9th ed. Chicago: Richard D. Irwin, Inc.

Hermanson, R.H., Edwards, J.D., & Invacevich, S.D., 2011, Accounting Principles: A Business Perspective. First Global Text Edition, Volume 2 Managerial Accounting, 37-73.

Vance, D. (2003). Financial analysis and decision making: tools and techniques to solve financial problems and make effective business decisions. New York: McGraw-Hill.

Doupnik, T.S., Hoyle, J.B. and Schaefer, T.F., 2012, Advanced Accounting. Boston: Irwin/McGraw-Hill, Print.

Doupnik, T.S, and Perera, H.B., 2012, International Accounting. New York: McGraw-Hill Irwin, 2012. Print.

McLaney, E. J., 2003, Business Finance: Theory and Practice (5th Ed). London: Pearson Education Ltd.

Samuels, J. M., Wilkes, F. M. and Brayshaw, R. E., 1998, Management of Company Finance (7th Ed). International Thomson Business Press.

Want help to write your Essay or Assignments? Click here

Fermi Problems Essay Paper

Fermi Problems
Fermi Problems

Want help to write your Essay or Assignments? Click here

Fermi Problems

Fermi problems are an estimated problem that is used to dimensional analysis and approximation and is often a back-of-the-envelope calculation. This type of estimation technique was named after the physicist Enrico Fermi, who was widely known for his approximation calculation prowess and at times, with little or no data. Fermi problems are used to justify guesses about their quantities and variance. Enrico has received worldwide recognition for most of his accomplishments, but the major one is his contribution to the development of the atomic bomb.

The talk by Lawrence is significant for physicians primarily to understand Fermi problems. Lawrence gives his viewers a physicist’s perspective of the world. He does so with the help of experiments, for example, he drops a book and a paper and asks which fall first while giving the explanation why the book fell first.

Want help to write your Essay or Assignments? Click here

The first of Fermi problems revolves around counting the number of equipment that is in a particular region for example piano tuners (Krauss, 2008). The first question is the number of people in the population, how many use keyboards and the number of families that own pianos. The second issue revolves around the number of substances that can fill another subject, for instance, the number of water balloons that can fill a room. One thing is to note the quantity of water that a single balloon can hold and the amount of water required to fill the room. Form there a simple calculation is exerted to find the number of approximated balloons and water.

There is a good chance that every time an individual breathes he/she takes in one molecule that was inhaled by Julius Caesar before his assassination. This was achieved using  Avogadro’s number (6.02×10²³) and which multiplies the number of molecules in a single breathe and the atmosphere. The next step is finding out the volume of the atmosphere and through calculation arrives at the number of molecules that are consumed by each person.

The number of piano tuners in London varies from 50 to 125. This can be arrived by viewing the whole population in London and estimating the number of households that own one and calculating the number of houses that regularly tune a piano and how many times a piano can tune in a day.


Krauss, L. (2008). Commentary: World Lines by Lawrence Krauss. New Scientist, 198(2653), 50.

Want help to write your Essay or Assignments? Click here

Depreciation Essay Paper



Depreciation is the allowance given on the wear and tear of property; an income tax is usually set aside for most assets to cater for the cost of assets (Aizenman, Hutchison and Jinjarak, 2013, p.38). The computation is done annually and for depreciation to be done a taxpayer must own the property and make sure that the property is used for business purposes and the property must have a useful life of more than one year.

This is done on tangible assets that lose value such as buildings, machines, vehicles, and equipment. It is also done on intangible property such as copyrights, patents and also computer software. Depreciating starts when the property is put to use for production of income, and it ends when the property fully recovers its cost or can no longer be used to do business (Bhandari, 2014, p. 42).

Property depreciating depends on the method, the property life, the basis of the ownership reduction and also the fact that the taxpayer has listed the property for repayment. Others factors determining depreciating are the first year of depreciation in that some properties don’t qualify for a discount for the first year.

 Since dep is a cost, it has to be included in the calculation of the national income. GDP is perceived as the measure of the market good (Bhandari, 2014, p. 42). As such when calculating national income capital depreciation is deducted from GDP. This because it gives us the market value of the property. On the other hand, depreciating is added to national income when computing GDP. In this case, Depreciation is added to the net domestic product as capital consumption allowance to get the gross domestic product. This because depreciation reduces the stock of capital and therefore it must be accounted.

Reference List

Aizenman, J., Hutchison, M. and Jinjarak, Y., 2013. What is the risk of European sovereign debt defaults? Fiscal space, CDS spreads and market pricing of risk. Journal of International Money and Finance, 34, pp.37-59.

Bhandari, R., 2014. An analytical study on depreciation of rupee against dollar & fundamental analysis on impact of macroeconomic factors on exchange rate of rupee. International Research Journal of Business and Management, 2(2), pp.36-43.

Want help to write your Essay or Assignments? Click here

Comparative Advantage and Absolute Advantage

Comparative Advantage and Absolute Advantage
Comparative Advantage and Absolute Advantage

Comparative Advantage and Absolute Advantage

Measures of Economic Growth

            According to economists, there are different ways of measuring the growth of an economy. According to Baldwin and Borrelli (2008), Gross Domestic Product is the commonly used measurement tool used to measure the economic growth of a given country. Nevertheless, certain economists believe that GDP is not a fully reliable method of measuring the growth of an economy.

In certain countries and institutions, improvement of the living standards can also be used as a tool for measuring the economic growth (David, 2005). GDP and other metrics such as unemployment rates, living standards, and inflation rates can help in determining the actual economic growth. Additionally, factors such as spending versus productivity can also help in quantifying the level of economic growth.

Comparative advantage and Absolute Advantage

According to David (2005), absolute advantage is the difference in the productivity of various countries while the comparative advantage denotes the differences that are there in the opportunity cost. Ideally, using smaller inputs to produce a large quantity of produce is known as an absolute advantage while the ability to produce at lower opportunity cost is a comparative advantage.

Therefore, certain countries such as China and the US have the absolute and comparative advantage at some point (Baldwin & Borrelli, 2008). For instance, the US use fewer resources to produce a given product compared to other countries. However, countries like China have a comparative advantage when they produce specific products at relatively lower margins.

            Both absolute and comparative advantage are two main important factors for the international trade. These factors elaborate how different nations use the little resources that they have to produce given quantities of produce (Hansen, 2012). However, the advantage and the disadvantage of a country also depends on its choice of goods to produce.

For other countries, devoting resources and manpower to other countries limits competition. For example, the US would devote resources to the vehicle-producing Japan rather than compete with it. In which case, Japan would have the absolute advantage while the US has a comparative advantage.


            Studies have revealed that China is one of the countries that continue to enjoy the advantage of its resources and human resources (Seretis & Tsaliki, 2016). China has overtaken countries like Japan to become the second-largest manufacturer after the US. Ideally, the country enjoys low labor costs while producing most of its products (David, 2005).

For China, the human resource is still an absolute advantage over many nations. The vast labor supply attracts larger investments and companies in the region. Compared to places such as the US where the human resource is declining, China enjoys a bigger absolute advantage (McConnell, 1999).

GDP Growth Rate in China

            The Chinese economy has grown to 6.7% in 2016, which is by the expectations. The GDP growth in China has been successful hitting a high rate at 15.4% in 1993.


            Unlike China whose production is labour-intensive, the US enjoys a comparative advantage by using its specialized labor resource. In as much as the labor resource in the US is abundant, the country’s main advantage is that its human resource is skilled. As such, the US can produce high-quality products using its rich and skilled human resource.

GDP Growth in the US

            The GDP in the US increased to 2.9% in the third quarter of 2016 1.4% higher than the last quarter. However, the increase is attributable to personal expenditure increases, the increase in exports, inventory investments as well as the increased federal government spending.

Saudi Arabia

            Unlike other countries such as China and the US, Saudi Arabia is a country that relies on a single vast natural resource. According to Hansen (2012), this country would be poor without the large oil reserve. However, the nation enjoys a natural comparative advantage over other countries. With its large oil reserve, the country can engage in a profitable international trade with other major countries. As such, Saudi Arabia continues to enjoy a wealth of natural resource that gives it the extreme comparative advantage.

GDP growth Saudi Arabia

Saudi Arabia GDP grows at a rate of 0.5%. The Trading Economics analysts, the rate will remain 0.5% at the end of this quarter. However, the long-term growth rate is projected to increase to 3.5%.

Democratic Republic of Congo (DRC)

            Likewise, DRC is another country that enjoys the vast amount of natural resources. This country has large scale diamonds and copper compared to other countries. With its large scale natural resources, this country enjoys an absolute advantage when it comes to trade. The GDP of DRC increased from $241.87 to $306.1 between 2009 and 2016. This, therefore, makes 2% of the global GDP.

Annual GDP Growth Rate

Unlike the increased GDP growth rates in most countries with absolute and comparative advantages, DRC remains one of the countries whose GDP is sluggish. The outraging political conflicts in DRC makes it hard for them to enjoy a stable economy. The growth rate in 2016 remains at 4.6%, which is low by 0.2% from the last rate.

Variance in Economies

            The GDP growth varies across countries of various continents. However, Ural (2007) maintains that there are four main factors that determine the variations. The main factors that lead to variations in the GDP growth across countries include differences in the workforce, physical capital, human capital and technology differences (Shelburne, 2016).

Workforce Differences across Countries

            The differences in workforce across countries affects the rate of GDP growth and the growth of the entire economy. Ideally, the differences depict the amount of labor that a given country has towards its production (Rnskov & Foss 2016). Countries like China have vast workforce I term of human resource. This helps them during production because they can get abundant labor as compared to other countries such as Saudi Arabia.

On the other side, the level of the workforce can also help a country in ensuring a large scale production. The abundant labor force is advantageous in production. As such, nations such as the US, China and India tend to have higher economic growth than the other countries.

Difference in Physical Capital across Countries

            Physical capital is a determinant of economic growth. The larger the physical capital of a country, the stronger the economy of that country. For example, the US has a capital stock of $30 trillion compared to smaller countries such as DRC and Saudi Arabia. Although China’s physical capital is also high, analysts believe that the US enjoys more efficiency in production due to a larger physical capital that the nation has (Hansen, 2012). Physical capital helps a country to fund its production efficiently without outsourcing for credits. This makes various nations different from one another.

Human Capital Differences

            Human capital refers to the value of the human resource that a country has. In most cases, developed countries have more valuable human resource than less developed countries. Grandke et al. (2015) reiterated that the value of human capital is measured by determining the level of education and level of skills that individuals of a given country possess. According to McConnell (1999), the level of education is correlated to the GDP growth.

Therefore, the differences in literacy levels in various countries lead to variations in the economic growth of different countries. For example, the US has high literacy levels than DRC and Saudi Arabia. Conversely, this affects the levels of expertise and skills that the human resource has in such countries. This difference explains why China and the US produce larger amounts of products that DRC and Saudi Arabia (Ural, 2007).

Technology Differences

Technology is fundamental in the production and growth of an economy. Rnskov and Foss (2016) opine that despite capital, human resource and workforce levels, the availability of technology also helps in determining the rate of production and consequently the economy. Through Research and Development, large firms can acquire knowledge and skills of producing various products (Shelburne, 2016).

To produce efficiently, individual countries must use the right technology. Nonetheless, the cost of employing the right technology in production can only be met by specific countries that have stronger and stable economies. For example, countries such as China and the US have the capacity to acquire the right technology for production. On the other hand, countries such as DRC lack the adequate capital to acquire the right technologies in production (Seretis & Tsaliki, 2016).

In most cases, countries such as Saudi Arabia and DRC will import technology from other countries such as China and the US. Technology increases efficiency. Thus, it determines the levels of output. The nature of the technology used by a particular company helps in achieving a high level of production (Rnskov & Foss, 2016).

Trade and the Strength of Economy

            Trade is one of the drivers of economic growth. International trade is attributable to economic development by reducing the levels of poverty while increasing the commercial opportunities for countries. Through trade, countries like China and Saudi Arabia have expanded their production rates. Additionally, trade increases the value of investments in various countries as they go up into the global value chain.

The international trade facilitates diversification of exports thus, helping countries to access fresh markets internationally. On the other side, trade ignites innovation through the exchange of technologies and expertise (Grandke et al. 2015). It is through trade that countries such as China and the US have the ability to create employment opportunities to their populations. Moreover, trade helps in stabilizing the relationships between various nations thus, creating peace and harmonious environments that facilitate development (Shelburne, 2016).

Lifecycle of Trade

            Trade life cycle comprises of the stages that the trade goes through. With the predicted outcomes and objectives at hand, trade life cycle is supposed to represent the forecasted events. Grandke et al. (2015), acknowledge that stages of a trade determine the progression of the trade from its inception throughout its progression. Different countries go through different stages of trade life cycle.

            To execute a trade, various processes and procedures must be followed. Ideally, the stages determine the success or failure of the trade. In most cases, the processes start with the execution of trade after the agreements have been made. In cases of international trade, Rnskov and Foss (2016) note that the stages of trade are determined by the progress made in previous stages (Shelburne, 2016). For instance, countries such as China and the US have established trade lifecycles compared to developing countries such as DRC. Based on a country’s resources, trade lifecycle can be efficient.


Baldwin, N., & Borrelli, S. A. (2008). Education and economic growth in the United States: Cross-national applications for an intra-national path analysis.Policy Sciences, 41(3), 183-204. doi:

David, H. L. (2005). So many measures of trade openness and policy: Do any explain economic growth? (Order No. 3179497). Available from ABI/INFORM Collection. (305006923). Retrieved from

Grandke, F., Singh, P., Heuven, H. M., De Haan, J. R., & Metzler, D. (2016). Advantages of Continuous Genotype Values over Genotype Classes for Gwas in Higher Polyploids: A Comparative Study in Hexaploid Chrysanthemum. Bmc Genomics, 171-9.

Hansen, T. J. (2012). The use of business tax incentives: An analysis of the economic performance of minnesota’s JOBZ (job opportunity building zones) program (Order No. 3503148). Available from ABI/INFORM Collection. (1009056994). Retrieved from

Mazurek, J. (2015). A Comparison of GDP Growth of European Countries during 2008-2012 from the Regional and Other Perspectives. Comparative Economic Research, 18(3), 5-18.

McConnell, I. E. (1999). Trade and the environment: Defining a role for the world trade organization (Order No. NQ41085). Available from ABI/INFORM Collection. (304561048). Retrieved from

Ørnskov, C., & Foss, N. J. (2016). Institutions, Entrepreneurship, And Economic Growth: What Do We Know And What Do We Still Need To Know? Academy Of Management Perspectives, 30(3), 292-315.

Rnskov, C., & Foss, N. J. (2016). Institutions, Entrepreneurship, And Economic Growth: What Do We Know And What Do We Still Need To Know? Academy Of Management Perspectives, 30(3), 292-315. Doi:10.5465/Amp.2015.0135

Seretis, S. A., & Tsaliki, P. V. (2016). Absolute Advantage and International Trade. Review of Radical Political Economics, 48(3), 438-451

Shelburne, C. R. (2016). Long-Run Economic Growth: Stagnations, Explosions and the Middle Income Trap. Global Economy Journal, 16(3), 433-458.

Ural, B. P. (2007). Essays in international trade and development (Order No. 3281742). Available from ABI/INFORM Collection. (304767664). Retrieved from

Want help to write your Essay or Assignments? Click here

An Amortization Schedule

An Amortization Schedule
An Amortization Schedule

An Amortization Schedule

An amortization schedule refers to a tabular presentation of the mortgage loan payment schedule, indicating the interest and principal amount paid until the loan is repaid fully (Brechner & Bergeman, 2014). An amortization calculator is used in developing the schedule, based on the amount, interest rate and repayment period. The amortization schedule is generally utilized for identifying the amount paid, to both interest and principal, and the outstanding balance.

An amortization schedule helps in the generation of identical payment over the repayment period, such that the entire amount is paid by the end of the period (Biafore, 2013).

The schedule is used in determining the percentage of interest to be paid during each period in comparison to the principal amount to be repaid. In essence, it separates the portion of payment that covers the interest expense from the portion the premium paid to the principal in each period. Biafore (2013) notes that even though a similar amount of premium is paid towards the mortgage each period, the amount allocated to the principal and interest varies each time.

This variation can be observed from the amortization table. The amortization schedule ensures that the borrower and lender are on the same page with regards to the amount repaid and amount owed. This means that in case of any dispute, the schedule acts as reference on the history of payment and pending balances.

The amortization table is useful to the borrowers in that it is a basis for organizing their finances. The borrower is able to track payments made, interest paid and money owed at any given time; such that they can determine their home equity at any given time. Lenders on the other hand can track what is owed by borrowers.

Response 3

            In amortizing the mortgage, a significant amount of the payments paid during the initial months mostly comprises of interest, while the remaining amount is paid to the principal (Biafore, 2013). The payments to interest then start declining as the mortgage is repaid, such that the interest paid in the later years is minimal or none.

Accordingly, the tax deducted based on home mortgage interest is likely to be higher during the initial years when a larger amount of interest is being paid, compared to later years when the interest being paid has reduced significantly. In this regard, it is logical to state that interest paid in earlier years plays a more helpful role in in tax reduction than interest paid in forthcoming years.      

Response 4

            An ordinary annuity differs from annuity due, mainly based on the timing. While the amount due in ordinary annuity is paid at each period end, an annuity due consists of cash flow series that occurs at each period’s beginning. The second difference is related with payment. In ordinary annuity, the payment done is associated with the period that precedes its date (Ehrhardt & Brigham, 2016).

Examples include mortgage payment, loans and coupon bearing bonds. Payment in an annuity due on the other hand, is associated with the period that follows its date. Examples include insurance premiums and rental lease payments.


  1. If interest rates are 8 percent, what is the future value of a $400 annuity payment over six years? Unless otherwise directed, assume annual compounding periods.

Future Value (FV) = P x [((1 + r) n – 1) / r]

Where P = Annual payments

            r = Interest rate

            n = Number of years

FV = 400 x [((1 + 0.08)6 -1)/ 0.08]

= $2,934.37

Recalculate the future value at 6 percent interest and 9 percent interest.

6% Interest

FV = 400 x [((1 + 0.06)6 -1)/ 0.06]

= $2,790.13

9% interest

FV = 400 x [((1 + 0.09)6 -1)/ 0.09]

= $3,009.33

  • If interest rates are 5 percent, what is the present value of a $900 annuity payment over three years? Unless otherwise directed, assume annual compounding periods.

Present Value (PV) = P [(1 – (1 / (1 + r)n)) / r]

Where P = Annual payments

            r = Interest rate

            n = Number of years

PV = $900 [(1 – (1/(1+0.05)3))/0.05]

= $2,450.92

   Recalculate the present value at 10 percent interest and 13 percent interest.

10 Percent

PV = $900 [(1 – (1/(1+0.1)3))/0.1]

= $2,238.17

13 Percent

PV = $900 [(1 – (1/(1+0.13)3))/0.13]

= $2,125.04

  • What is the present value of a series of $1150 payments made every year for 14 years when the discount rate is 9 percent?

Present Value (PV) = P [(1 – (1 / (1 + r)n)) / r]

Where P = Annual payments

            r = Interest rate

            n = Number of years

PV = $1150 [(1 – (1/(1+0.09)14))/0.09]

= $ 8,954.07

 Recalculate the present value using discount rate of 11 percent and 12 percent.

11 Percent

PV = $1150 [(1 – (1/(1+0.11)14))/ 0.11]

= $8029.15

12 Percent

PV = $1150 [(1 – (1/(1+0.12)14))/ 0.12]

= $7,622.39


Biafore, B. (2013). QuickBooks 2014: The Missing Manual: The Official Intuit Guide to QuickBooks 2014.  Sebastopol, CA: O’Reilly Media, Inc.

Brechner, R. & Bergeman, G. (2014). Contemporary Mathematics for Business and Consumers, Brief Edition. Boston, MA: Cengage Learning.

Ehrhardt, M. C. & Brigham, E. F. (2016). Corporate Finance: A Focused Approach. Boston, MA: Cengage Learning.

Want help to write your Essay or Assignments? Click here