(solved) Economics for Managers Assignment PDF
Added on 2020-03-28
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Running head: ECONOMICS FOR MANAGERSGREAT RECESSION IN USA: ITS CAUSESName of student:Name of UniversityAuthors note:
1GREAT RECESSION IN USA: ITS CAUSESExecutive summaryThis particular study aims to focus on causes behind the global financial crisis that brokeduring 2007 to 2008. Study mainly focuses US economy because US economy was largelyinfluenced due to financial crisis. Study also considered GDP, Unemployment and tradingpattern of USA to assess the effect of global financial crisis on the economy. The results found inthe study shows that elements like housing market bubble, stock price crash, credit default anddumping from china are the main reasons behind financial crisis.
2GREAT RECESSION IN USA: ITS CAUSESTable of ContentsIntroduction......................................................................................................................................4Discussion........................................................................................................................................4Role of Business Cycle to understand the recession...................................................................5Causes of Global financial crisis.................................................................................................7House market bubble...............................................................................................................8Stock market crisis...................................................................................................................9Credit default.........................................................................................................................10Dumping from China.............................................................................................................10GDP and Global Financial Crisis..............................................................................................11Unemployment and Global Financial Crisis..............................................................................12Trading pattern and Global Financial crisis...............................................................................13Conclusion.....................................................................................................................................14References......................................................................................................................................16
3GREAT RECESSION IN USA: ITS CAUSESIntroductionThe period from 2007 to 2008 marked as the period of Financial Crisis and is consideredas first contraction of global economy after the period of Second World War (Aguiar, Hurst andKarabarbounis, 2013). Many economies were affected by this Financial Crisis and sluggishrecovery was observed subsequently (Lo and Rogoff, 2015. This recession period wasobserved to be different from prior recessions, since it marked simultaneous changes in thestock market, labor market and housing market (Jenkins, 2012).Along with other countries, USA was also affected due to this financial crisis. The degreeof loss for the economy was much higher, all the economic indicators of welfare was affected bythis crisis (Riumallo-Herl, 2014).Affected indicators of the economy in turn hindered the growthof the economy which resulted in negative GDP rate of the economy (Del Negro , Giannoni andSchorfheide, 2015). The aim of this paper is to explore the main causes behind the great recession thatoccurred in 2007-2008 in USA. Paper focused on the causes and their effect on economy.Development indicators are considered in this paper and these includes- GDP, unemploymentand pattern of trade (Morse, 2014).DiscussionVarious methods can be used to understand the degree of loss incurred by USA economy,business cycle is one such method that is used to interpret the phase through which the economypasses over time.
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