Help me with economy!
Economy is kind of (for some reason) a hard concept to understand for me. Primarily the boom and bust cycle. Are boom periods suppose to be good for everyone? And on my homework (lulz) theres a question that says "Relate to cost of living, wages, income gap and standard of living". Please help a Basiler out
Thank you very much!
May 14, 2011
6 Comments • Newest first
Thanks alot for the help you guys, I think I understand it now!
[quote=madsimba]Could you please elaborate on the boom portion? If more products are being produced, wouldn't that mean lower prices for everyone? I don't quite understand how cost of living and standard of living would increase.[/quote]
A boom mainly results as an increase in customer demand, which in term increases prices. Wages then increase to offset the increased prices, leading to a higher standard of living for everyone, while at a higher cost than before.
[quote=madsimba]Could you please elaborate on the boom portion? If more products are being produced, wouldn't that mean lower prices for everyone? I don't quite understand how cost of living and standard of living would increase.[/quote]
higher pay, higher prices..so living would increase.
[quote=pr3stig3]First, understand that the course you're taking is Economics, so your title should be "help me with economics".
Second, boom and bust = exactly how they sound. Periods of boom and bust. Boom = increased GDP, increased cost of living and prices all around, increased wages, higher income gap and higher standard of living. After a while, consumer demand eventually dies down, resulting in a bust. Bust = decreased GDP, decreased cost of living and prices, decreased wages, decreased income gap and decreased standard of living.[/quote]
Could you please elaborate on the boom portion? If more products are being produced, wouldn't that mean lower prices for everyone? I don't quite understand how cost of living and standard of living would increase.
During booms an economy will see an increase in its production and GDP.(good)
During busts an economy will see a fall in production and an increase in unemployment.(bad)
but yeah, the guy above me knows what he's talking aboot
First, understand that the course you're taking is Economics, so your title should be "help me with economics".
Second, boom and bust = exactly how they sound. Periods of boom and bust. Boom = increased GDP, increased cost of living and prices all around, increased wages, higher income gap and higher standard of living. After a while, consumer demand eventually dies down, resulting in a bust. Bust = decreased GDP, decreased cost of living and prices, decreased wages, decreased income gap and decreased standard of living.