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Managerial Economics Report (Doc)

   

Added on  2020-05-08

22 Pages2529 Words57 Views
Running head: MANAGERIAL ECONOMICS Managerial EconomicsName of the StudentName of the UniversityAuthor Note

1MANAGERIAL ECONOMICS Table of ContentsAnswer 1:.........................................................................................................................................2Part a:...........................................................................................................................................2Part b:...........................................................................................................................................3Part c:.........................................................................................................................................11Part d:.........................................................................................................................................11Answer 2:.......................................................................................................................................12Part a:.........................................................................................................................................12Part b:.........................................................................................................................................12Part c:.........................................................................................................................................13Answer 3:.......................................................................................................................................14Part a:.........................................................................................................................................14Part b:.........................................................................................................................................14Answer 4:.......................................................................................................................................15Part a:.........................................................................................................................................15Part c:.........................................................................................................................................16Part d:.........................................................................................................................................16References......................................................................................................................................17

2MANAGERIAL ECONOMICS

3MANAGERIAL ECONOMICS The two countries chosen for the assignment are Australia and the United States ofAmerica, both being two predominant economies of the world. Answer 1: Part a: Both the USA and Australia being net importer of oils, the reduction in the global oilprices are expected to have positive implications for the country. However, the decrease in thesame does effect the domestic producers adversely as they face a reduction in profits. The devaluation of the domestic currencies helps both the concerned countries to increasetheir exports while their imports become more costly. Increase in the currency value, however,has the opposite effects. High inflation in the country becomes hurting for the households. However, a controlledincrease in the inflation helps in increasing employment. Very low inflation on the other handimplies that the productivities and aggregate demand are low. Low interest rates facilitate investments and production in a country whereas high interestrates encourages savings and therefore, this monetary tool is used according to the need ofeconomic growth of the country. High industrial production in a country increases productivity as well as employment,thereby leading to economic growth in a country.

4MANAGERIAL ECONOMICS Part b: 1. Figure 1: Oil prices (2005-2017)(Source: Opec.org, 2017)As can be seen from the above figure, the oil prices, which started increasing significantly in2011 till 2014, reduced significantly in 2015 and continues to remain low.

5MANAGERIAL ECONOMICS Australia: Figure 2: GDP of Australia(Source: Abs.gov.au, 2017)The GDP of the country kept on increasing consistently till 2013 before declining a little in thecurrent period.

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