April 28, 2013
1. Use the Kaplan electronic library and databases to research and compose a 5- paragraph essay (APA format) to identify a minimum of 3 economic concepts and/or theories from this course and how they relate to some current event (properly cite a minimum of three electronic references).
The first concept I am going to discuss is recession.
A recession is a period of temporary economic decline during which trade and industrial activity is reduced, generally identified by a fall in GDP (Gross Domestic Product) for two or more consecutive quarters. During my search, I came across an article titled “America’s Response to a Deep Recession”. In this article it states that in March 2009 more than nine in ten Americans (93 percent) rated the nation’s economy negatively, as no-so-good or poor, while only 7 percent said it was excellent or good (Blendon & Benson, 2009). Recessions hurt the middle class and the poor. Many lose their jobs, have their hours or pay cut and have cut back on most everything but the necessities, which brings me to my next topic about inflation.
The second concept I am going to discuss is inflation.
Inflation is a general increase in prices and fall in the purchasing value of money. Inflation is important to understand because it can directly affect the average consumer. Minimum wage increases can lead to increased inflation. The article that I came across is titled “Do minimum Wage Increases Cause Inflation?” In the article, it states that minimum wage increases can lead to negative impacts by reducing the demand for labor or by increasing the output prices (Cuong, 2011). Minimum wage is the lowest monthly paying wage for a single worker, which is required to ensure the basic needs of the worker and their families. During inflation, prices go up and minimum wage must go up as well.
We are seeing minimum wage getting higher and higher all the time, but we also see the...