ACE Class Report #72: Economic Theory Part 2.
Begin: 7/24/2024
Finish: 8?15/2024
Title: Economic Theory Part 2
Instructor: Farhad Nafeiy
Why I choose to take this class:
To learn more about economy. Basic understanding about Economic Theory will help me understand about the business world, improve my analytical and critical thinking skills.
What I learned from this class:
Many government seek to reduce unemployment and keep prices low using fiscal and monetary policies. Fiscal policy is devoted to managing of tax revenue and government spending. Monetary Policy involves managing the money supply and value of this nation’s currency. Monetary policy is typically conducted by the Nation Central Bank. In the United States, the central bank is the Federal Reserve System. Although established by the Federal Government, the Federal Reserve is most an independent agency. It adjust the money supply by buying and selling bonds, setting requirements that bank hold money in reserve and setting interest rate at which Federal Reserve makes loans to national banks. Currently, the Federal Reserve uses monetary policy to influence the Federal Funds rates, the interest rate at which national banks make loans to each other. The Federal Reserve does not, however direct control over this rate.
Standard of Living:
The Standard of Living is a measure of the general well being of an individual family, or group of people. Economist use Gross Domestic Product (GDP) per person as the average standard of living. GDP is the market value of all final goods and services produced within the country. Countries with the highest GDP per person typically have more food, more consumer goods, better housing, greater educational opportunities and better medical care.
Consumer Price Index (CPI):
Is a measure of changes in the price of goods and services bought by most people in the United States. The CPI compares the cost of more than 200 types of goods and services with their cost at an earlier time. The CPI is the chief measurement of inflation (rising prices) in the US. Employers use CPI to determine wages and benefits increases and government use it to calculate Social Security benefits. The Federal Reserve also consider the CPI as it raises and lowers interest rates. CPI is prepared by the Bureau of Labor Statistics (BLS).
Types of Business:
Types of business ranges from: sole proprietors, small business, corporation, multi national corporations and monopoly. Antitrust Laws are regulations that seek to promote competition in the markets. Monopoly are usually restricted to utility companies where infrastructure cost is high and competition is not feasible.
Supply and Demand:
A free market economy competition sets the prices that allocate goods among buyers and sellers. Usually as the price decrease, the demand increase. Ultimately when quantity supplied is equal to the quantity demanded – the market is said to be in equilibrium.
Services and Data:
Services are activities performed that have value to someone. The latest demand is big data: all your personal data, multimedia data, shopping pattern, affiliation, everything about you especially when you use the internet or multimedia. Big corporation like: Facebook, Google, Amazon, Microsoft, Apple and others. Gather all the data and are sold to companies that uses this information to entice you to buy their products, thus a lot of pop up advertisement shows up on your browser or multimedia devices. the data can be sorted into categories that companies uses to target their advertisements. Thus the big demand for big data company.
How will this class contribute to my success upon release:
This class taught me a lot about governmental policies an their function to keep inflation, recession an depression in check. Also the direction that big data company are targeting and influencing our purchase decisions. This class improves my analytical and critical thinking skills. These information will be shared with communities which I hope to volunteer my teaching, tutoring and monitoring services.
