Effects of Inflation

Inflation is defined as a sustained increase in the general level of prices which results in a decline in the purchasing power of money. Inflation is measured through the Consumer Price Index (CPI) which measures proportional changes in prices in a representative â€Å"basket† of g’n’s, weighted according to their importance in a typical Australian households budget. The RBA aims to keep inflation at an annual rate of 2-3%, and in order to do this a number of policies are available for the Australian government.Keeping Inflation under control is a primary concern for the Australian Government as it affects so many different parts of the Economy, including Economic growth, standard of living and unemployment. There are three types of inflation, depending on their causes. Firstly, demand pull inflation occurs when there is an excessive aggregate demand at or near full employment. If aggregate demand exceeds aggregate supply, prices of g’n’s rise as a rationing mechanism. This form of inflation is usually associated with periods of high economic activity.Secondly is cost-push inflation. If business costs such as the cost of wages or materials rise, businesses may aim to maintain profit levels by passing these costs onto consumers. This will result in higher prices and therefore inflation. The final type of inflation is imported inflation. Imported inflation occurs when the price of imports rises, and either adds to business costs (resulting in cost-push inflation) or feeds into the CPI as the price of final goods. Furthermore, a depreciation in the Au$ will raise import prices, also adding to imported inflation.There are a number of factors which may cause inflation in the Australian economy. A major cause of demand-pull inflation is excessive growth in aggregate demand. If aggregate demand increases from AD to AD1, aggregate supply which is the equivalent of real GDP will rise to GDP2 and the price level will rise from P to P2. This results in the inflationary gap of cd. This increase in aggregate demand may be the result of a number of factors, including increases in consumption expenditure, investment spending, net government expenditure, the money supply, or export incomes.Another major cause of inflation, this time cost-push inflation, is a decrease in aggregate supply. If aggregate supply decreases from AS to AS1, real GDP will decrease to GDP2 and the price level will rise to P1. This results in both a contraction in real GDP and a rise in inflation. The main causes of this decrease in aggregate supply is excessive wage growth not accompanied by productivity increase, a rise in the cost of raw materials, and other inputs, or a rise in government taxes or other charges that raise costs for firms.Cost-push inflation may also be the result of imported inflation it there is a rise in world prices of imported goods used in the production process (such as raw materials and intermediate goods) firms are lik ely to pass these costs onto consumers, resulting in inflation on the other hand if there is a rise in world prices of consumer goods, increased import prices will feed directly into the CPI, also resulting in inflation. Furthermore a depreciation in the Au$ in foreign exchange markets will result in a rise in the prices of imported raw materials, intermediate goods, and consumer goods, again contributing to Australia’s inflation.This is demonstrated in the stimulus when the RBA credits the decrease in inflation to the fading impact of 2000s exchange rate depreciation. A less common cause of inflation is the existence of monopolies or oligopolies. If a monopoly or oligopoly exists in an industry, the lack of competition allows producers to push up prices. This again results in inflation. The final cause of inflation in Australia is inflationary expectations. Inflationary expectations refer to the behaviour of individuals and businesses who seek to compensate for the current i nflation, as well as expected future price rises.This may be the result of either firms pushing up prices, or wage earners seeking higher nominal wages. Also, if consumers expect future prices to rise, they rather buy g’n’s now, which leads to increases in spending. This results in demand-pull inflation. Inflation can impact the economy in 3 ways. 1)By encouraging investment in speculative and unproductive activities and discouraging investment in ventures considered productive. Inflation encourages investment in real assets such as gold and real estate because they are considered ‘good shelters’ for inflation.This is because the scarcity of them often outpaces or at least keeps pace with the rate of inflation. If inflation occurs, people will seek to own such assets, shifting resources to these speculative and unproductive assets. Similarly this discourages investment in other assets. This is because entrepreneurs will not think it is financially viable t o invest and pursue a project that will only result in less profit, due to the higher costs of inflation. Similarly inflation increases the cost of production thus also discouraging entrepreneurs.For example, if inflation is high, people will invest in gold and real estate. Otherwise known as the opportunity cost, because people will allocate their resources into such ventures (gold and real estate) they must then forego investing into other ventures that are considered productive such as a new business, that may be producing capital goods or normal goods and services. Also by discouraging entrepreneurs is the rise in the costs of production that occur due to inflation, for example the raw materials.Similarly interest rates will rise, making it more expensive to borrow funds for investment purposes, making investment projects less profitable. Either way, inflation can cause a loss in production of capital goods, leading to lower living standards in the future, or a loss in the produ ction of normal goods and services, leading to lowering current living conditions, as current needs and wants go unsatisfied. Since returns from productive capital take longer to materialise, it means that entrepreneurs are also faced with a lesser return.This means that if the rate of inflation is greater than the return offered by the investment, then the project will not be considered economically viable, nor worthwhile. Similarly the risk of loss from any investment project will grow with inflation. Many small businesses take a couple of years before they start to make a profit, so if inflation is high, and is was not taken into account when the business was first planned, then the cost of production may rise, and the resulting price for the commodity will be too high for consumers. ) If inflation is present and is greater than that overseas, it reduces the overseas competitiveness of the Australian economy. This is because inflation is not only associated with a rise in prices, but also an increase to the costs of production. Therefore making overseas exports cheaper to the domestic market. Similarly the overseas firms do not have to put up with the rises in the costs of production. This provides a leakage in the circular flow (purchase of exports) and thus dampening demand in the domestic market, which if severe enough could lead to a recession, bringing with it many economic problems.An example of how inflation can lead to a recession, would be the 1970s, when high inflation averaged at 10. 4%. Which due to the high oil prices and strong domestic demand led to high inflation in the 1980s (8. 1%). This period of high inflation led to a dampening in spending and a recession in the 1990s (1990-1992) causing many problems such as unemployment. 3) It also creates many winners and losers in the economy. Those that benefit are the owners of real assets (real assets and gold), because their assets are worth more.As well as those belonging to well-organized grou ps who can demand wage increases (eg, strong trade unions. ) This can lead to rapidly rising wages, increasing the costs of production, and also discouraging investment in productive capital as mentioned above. In addition to this inflation can benefit people who have already borrowed funds because the cost of repayment, represent less as inflation rises. This is because inflation is defined by a loss in the real value of money, therefore the repayment will diminish over time.Conversely inflation disadvantages those on fixed incomes because they lose the real value of income as their money represents less purchasing power. Similarly for the same reasons it disadvantages those that keep their money in liquid form (ie, bank deposits). Also those that lend money receive less back in terms of repayment, due to the loss in value (eg, A mortgage repayment in 1960 was worth more than in 1980, where high inflation had occurred).Also since it reduces international competitiveness, inflation can disadvantage exporters who find themselves with less business opportunities. This can effect the economy, as overseas markets will not purchase Australian goods and services. Therefore the economy will not receive the injection into the circular flow that it would usually, without inflation. Without the strong domestic support that is present in Australia’s economy, the economy could have the effect of dampening economic activity, and aggregate demand.When inflation occurs in the Australian economy it usually had a number of causes. The main causes are excess aggregate demand, cost-push inflation, inflationary expectations and imported inflation. inflation disadvantages many groups in the economy, who in turn benefit other groups. This is because inflation can influence the allocation of resources in regards to encouraging and discouraging investment, the overseas competitiveness of the Australian market, as well as effecting individuals and firms, who often benefit at th e expense of others.

Gran Torino Film Review

Gran Torino Gran Torino is an American drama film, released in 2008 film directed and produced by and also starring Clint Eastwood. Set in Detroit, Michigan it was the first mainstream U. S. film to feature Hmong Americans. Gran Torino was a critical and commercial success, grossing nearly $270 million worldwide and is also said to be Clint Eastwood’s most successful film, but as like many films Gran Torino received both praise and criticism. Gran Torino† tells the story of Walt Kowalski (Clint Eastwood), a grizzled Korean War veteran whose wife recently passed away. Walt lives alone with his dog in a Detroit, the neighborhood he’s lived in for well over 30 years in no longer populated as he would say ‘lower middle class white folks’, but has turned into an Asian neighborhood. A Hmong family lives next door, a grandmother, single mother and her two teenagers Thao (Bee Vang) and Sue (Ahney Her).Thao is quiet and intelligent but very shy, where as Sue i s very outgoing and fearless. The local Asian gang led by Thao’s cousin tries to recruit Thao. Thao does not have a choice because you cannot say no to a gang, they talk him into trying to steal Walt’s 1972 Gran Torino, Walt Stops it from happening but Thao gets away unrecognized. Then Thao is forced by his sister and mother to work for Walt in an effort for the attempted to steal his car.The two become very close as Walt see’s the good and potential in Thao and teaches him how to be a man and steer clear of the gang. Walt vows to protect Thao, setting the stage for a showdown with the gang. Clint Eastwood is really great to watch in this movie, his acting throughout Gran Torino really convinces you that he is a retired old war veteran, who has seen it all and is afraid of nothing. The way he confronts trouble throughout the film is impressive especially in the one scene where he comes up against three men harassing Sue on her walk.From my point of view there ar e a few camera angles portrayed throughout the scenes of the film, but there is hardly and visual effects or anything else, I think what makes this movie a good hit is Clint Eastwood’s attitude showed in his acting and the rest of the actors as well, and yes of course during the film Walt is very racists and says lots of different ethnic comments but the point is, well the point that I noticed was that Walt starts to look past and see the people for who they really are not just look at their race or where they come from.This movie is perfect for Clint Eastwood fans or young adults and older, I wouldn’t really say it is for teenagers because they might not fully understand the film and just think that Walt is a grumpy old man who just gets fired up over nothing. I rate it a 4 out of 5.

Second Analytical Paper Essay Example | Topics and Well Written Essays - 750 words

Second Analytical Paper - Essay Example It was easier for Gilbert to use his power over African settlers because of the superiority he felt for them. With the use of colonialism, and with the proper methods that he introduced to the settlers, he was able to gain the confidence of the native Africans, consequently building for him a place in the social strata in Africa and establishing a position of power and superiority. Gilbert is from a more developed country thus is educated with more advanced farming methods. England is a developed country with all the advantages of the United Kingdom and all the influence over its neighboring countries. England also keeps the education being given in schools and universities at par with global standards that makes the graduates of the country viable for any premier company. England sees to it that it produces citizens who not only are able to provide for him but is also able to work from different settings. Citizens coming from England like Gilbert are trained under rigorous circumstances to be able to adapt to the situation they are put against so that they will not face any difficulties. The presence of high tech resources and internationally acclaimed gadgets for demonstration purposes as well as for real world problems make them highly knowledgeable in terms of the recent innovations in technology. This Gilbert used in his colonialism strategy in Africa. While he was an average individual in England, he was a highly skilled person in the eyes of Africans, thus making him a man more than he really as. Coming from a country of wealth and power makes controlling poor countries easier. Gilbert was a man who was accustomed to the vestiges of success and competition. England is a highly revered country that is able to use its available resources for the betterment of its colonies. England is also a country that claims to take initiative to take under its wings countries that need support in terms of technical

RF Integrated Circuits-electrical engineering Thesis Proposal

RF Integrated Circuits-electrical engineering - Thesis Proposal Example The metal-oxide-semiconductor field-effect transistor (MOSFET or MOS) is a four terminal device that can operate in three different regions – cut-off, linear and saturation regions – that states the current it can supply depending on the voltages applied to those terminals (Rabaey 57). Static Complementary MOS (static CMOS) is the most widely used logic style, because it presents some important characteristics: low sensitivity to noise (robustness), good performance, low power consumption, availability in standard cell libraries, among others. Also, the BiCMOS technology has become a viable option for RF applications. The main challenge in the design of RF circuits for products is due to the little operation margins given by the constraints on power consumption and noise (ENZ 189). It is not simple to do the IC design in an environment that is mostly used for digital electronics by involving a RF part. It can be said that the RF parts of an IC do not interact properly w ith the digital parts, since there is a tendency of noise from one part getting into the other. One possible solution is to isolate the RF circuit by shielding it. The modeling of the MOS transistors for operating at RF should be able to accurately predict the performance of the circuits.

Analyzing Al-Qaeda Essay Example | Topics and Well Written Essays - 750 words

Analyzing Al-Qaeda - Essay Example Its associates have carried out attacks against prospects in a range of countries around the world, the most prominent being the September 11, 2001 attacks that were on the twin towers and the pentagon in New York and Northern Virginia. After the September 11 attacks, the United States government started a wide military and intelligence operation commonly known as the War on Terrorism, with the objective of dismantling al-Qaeda and killing or capturing its operatives and members. The leadership of this terrorist organization is held by Osama bin Laden, an active character in Soviet invasion of Afghanistan. Second to him in the organization is Ayman al Zawahiri who is an Egyptian surgeon. Apart from this other regional leaders also exist. One senior al-Qaeda member, Muhammad Atef was killed in the U.S. air strikes in Afghanistan, and another top commander, Abu Zubaydah, was arrested in Pakistan in March 2002. In March 2003, Khalid Sheikh Mohammed the mastermind behind the 9/11 attacks, and al-Qaeda's treasurer, Mustafa Ahmed al-Hawsawi were also captured in Pakistan. The Al Qaeda network basically extracts its funds and financing from extremists around the world and the Arab world that is rolling in money from oil exportation. When Soviet invasion in Afghanistan had to be stopped United States itself funded Osama bin laden, but since the first terrorist attacks the funding was stopped. INFRASTRUCTURE The organization does not operate from a single head quarter but from different locations and through different groups. Any terrorist act performed by the organization is accepted in a video tape usually launched after the activity. The organization has branches in hundred countries around the globe including the United States. Anti terrorist campaigns have successfully broken Al-Qaeda's cells in the United States, Albania, Germany, Italy, France, Spain, United Kingdom, and Uganda. PLANNING There are different planners for different activites, mostly people related to the region of the terrorist activity are selected for planning the terrorist activity that is going to take place. After the fall of the talibans in Afghanistan the main head quarters of Al Qaeda has been shattered and now the organization operates from different locations through out the world. Al Qaeda has targeted American and other Western interests, Jewish targets and Muslim countries it sees as corrupt or non religious plus the the Saudi monarchy. The list of attacks include. Bomb attacks on Madrid commuter trains, which killed nearly 200 people and resulted in more than 1,800 injuries. Car bomb attacks on three compounds in Riyadh, Saudi Arabia. Car bomb attack and an attempt that did not succeed to shoot down an Israeli plane with missiles, both in Mombasa, Kenya. Attack on a French tanker off the coast of Yemen. Many bombings in Pakistan Explosion of a fuel tanker in Tunisia. The major Hijacking attacks on the World Trade Center and the Pentagon. Bombings of the U.S. embassies in Nairobi, Kenya, and Dar es Salaam, Tanzania. The main methods of attacking used are suicide bombing, planting bombs at locations and hijacking planes. The attacks have led to the death of millions of innocent people and have left a mark of terror on people,

Nationality and ethnic characteristics Essay Example | Topics and Well Written Essays - 250 words

Nationality and ethnic characteristics - Essay Example One is often inclined to tag a person through his or her unique attribute like appearance, nationality, eccentricity, accent etc. Nationality and ethnic characteristics are most frequent way of defining a person. In my neighborhood, there is Mexican person who is very jovial but he has an irritating habit of shaking his head and laughing at silly jokes. So we often refer to him as ‘mover and shaker’ and like to interact with him because he gives such unique perspective to serious and non serious issues. Unfortunately, he is also a crooked old bachelor of seventy years and his crusty ribald jokes sometimes become irritating. He thinks the world is a merry go round and we must enjoy every moment. But perhaps, he is right because we are living in a fast paced time where we often forget to interact with nature or even enjoy the leisure time. The competitive world has made us more selfish and less prone to enjoy our success lest we may lose it to our competition. Our mover an d shaker makes us laugh. His silly jokes make us forget our sorrows and tensions of the day. Whenever we are angry at someone or something, he would jokingly tell us to imagine that person as a stone. Then he would pick a stone and ask us to throw it away. With him we would often throw away our tensions just like stones. His unique way of looking at things has made us wiser and a better person. We have learnt from him that love and laughter must be cherished as life is too short to waste it away on hate, jealousy and rivalry.

Karl Popper's theory on violence Essay Example | Topics and Well Written Essays - 1250 words

Karl Popper's theory on violence - Essay Example He saw how Einstein had been critical f his own theory, constantly trying to pick holes in order to disprove or, as Popper saw it, improve it. This contrasted sharply with the attitude f Marxists and Psychoanalysis's who, it seemed to Popper, created theories and then re-interpreted them to suit any given situation. This first encounter with empirical evidence and its foundation for the proving f theories would lead him to his eventual way f thinking about falsification theory. Karl Popper argues that scientists should start with a hypothesis, or a statement that is to be tested. The statement should be precise and should state exactly what will happen in particular circumstances. On the basis f the hypothesis it should be possible to deduce predictions about future happenings. According to Popper it matters little how a scientific theory originate, it does not have to come from prior observation and analysis f data. Popper denies that it is even possible to produce laws that will necessary be found to be true for all time. He argues that, logically, however many times a theory is apparently proved correct because predictions made on the basis f that theory come true, there is always the possibility that at some future date the theory will be proved wrong or falsified. Popper argued that scientific progress required a ground work f structure and rationalisation where theories that seemed opposed to each other could be evaluated fairly and equally. To this end Popper created a scientific approach, called falsifications. He summed up the theory with the phrase "I may be wrong and you may be right, and by an effort, we may get nearer to the truth." Instead f constantly trying to find new evidence to support a theory, Popper claimed we should try to falsify them, and thus be able to judge one against another. In other words every possible theory would be able to be rationally and without malice debated about the different positions, and then choose the theory that cannot be falsified, or comes closest to it. The "best" theories could still not be verified or justified, but since they had not been falsified either, they would be preferable to falsified theories. The rationality f holding a particular position would be granted to the extent to which the theory is open to criticism (Norris Turner, 2000). The most fundamental aspect f Popper's falsification theory, inspired by Socrates, is that we have no way f knowing anything to be solid fact, and even anything we believe to be unshakably true could be, in the future, utterly disproved. Therefore we cannot approach any aspect f scientific debate, without acknowledging this central tenet. Popper argued that this would actually inspire further debate and progress as it allowed us to understand our limitations i.e. we had a base to begin with. He wrote, "We know nothing--that is the first point. Therefore we should be very modest--that is the second. That we should not claim to know when we do not know--that is the third." In many ways this is similar to Descartes effect on philosophy, with his central idea 'I think, therefore I am'. He believed that everything in our lives was really only the way we perceived it, not the way it really is. The only certain thing in existence was the fact that you were thinking, this gave philosophy a f oundation to work from; similarly