20 likes | 140 Views
Economics and Society (Homework, 16 February) Question 13: Efficiency: To produce the maximum of desired goods (Allocation target) Equity: To distribute goods as equally as possible, cake principle (Distribution target)
E N D
Economics and Society (Homework, 16 February) Question 13: Efficiency: To produce the maximum of desired goods (Allocation target) Equity: To distribute goods as equally as possible, cake principle (Distribution target) In terms of equity this would make sense every person has the right to the best healthcare. Problem: ”Efficiency ” In terms of equity this measurement is good. Problem: Some people would not have the interest to find a new job. Not very efficient for the Economy. Question 14: Cave Principle: People strive for the better. In terms of development (electronics etc.) life is more advanced. Globalisation: Everything is linked, world is connected. This phenomena is very “young” Question 15: Companies could make investments and improve their productivity. Decrease unemployment Question: If people save money who will then consume these products, “investments”? Society would not profit from this in long term interval.
Economics and Society • (Homework, 16 February) • Question 16: • One would need to know how much capital exists in an economy. In this case Banks should decrease their “production” of money. • How unemployment and inflation are linked: • According to the Philips curve: • More inflation more employment • Less inflation more unemployment • people would have to work more in order to keep the Economy on the same level of efficiency • Question 17: • Example:Greece • Principle 8: The standard of living depends on a country’s production. • Greece’s amount of debt is too high not a very efficient condition for an economy • People face unemployment, increasing tax etc.