Monetary Policy, Fiscal Policy, Business Cycles, and Economic Growth Assignment

Monetary Policy, Fiscal Policy, stock Cycles, and Economic Growth - Assignment ExampleOwners of multinational companies in Malawi will suck up reduced dividends. close to multinational corporations employees in Malawi will either be laid-off or receive lower salaries (Hansen, 2013).6.b). If the death chair of Malawi imposes a mandatory minimum wage of $5.00 per hour, workers in multinational companies will receive better pay. Consequently, the take aim of poverty will reduce in the country. Multinational corporations will incur more cost peculiarly salary expenses. Due to higher costs profits for the companies will reduce thus shareholders will receive lower dividends. Multinational corporations might decrease the number of employees to reduce the salaries expenses they incur (Hansen, 2013).7. Western states like the coupled States and United Kingdom resort to deficit using up by borrowing money to stimulate frugal growth or recovery in times of economic recessions. The main disadvantage with deficit outlay is that it leads to interest accounts. High-interest rates reduce the ability to borrow. High-interest rates discourage entrepreneurs to invest. Consequently, low investment rates symbolise that the production capacity of a country is reduced the general output of the country decreases hence. Reduction in the output of a country reduces the rate of economic growth in a country. Deficit spending means that the government spends more than the private sector. States tend to utilize resources inefficiently. So these actions might lead to extra resources. Deficit spending and increased borrowing increases an economys inflation rate. Increasing inflation rate reduces the value of a currency and adversely affects its competitiveness with other currencies. Inflation will also lessen the amount of savings (Hansen, 2013).8. Listening to Laurence Kotlikoff of Boston University, I was interested in the argument he brought fore regarding the governments con cealment of its debt obligations. Kotlikoff pointed out that United