Private Suffering, Private Gaining And Private Investments

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During this unit the text went over the fact that national savings and investments are directly related to changes to one or all of the following, private savings, private capital investments or private trade balance. Although national borrowing can complete with private investment, the Ricardian equivalence suggests that budget deficits and be corrected by private spending and budget surplus can be corrected with private borrowing. However that has only been proven to be partially true in specific examples. Chapter 19 covers global macroeconomic policy and how all countries strive for high standards of living, high income and low unemployment. The fact is not every county is or can be perfect and therefore are classified into low,…show more content…
The goal of low income focuses on social welfare and increasing revenue. “After sharply increasing to almost 9 percent in the period 2013-2014, the real gross domestic product (GDP) rate decelerated in 2015 and the growth rate is not expected to exceed 2.5 percent in 2016. This slump is mainly due to declining raw material prices and a shrinking global demand for raw materials” (Worldbank, 2017). This is just one example of the difficultly in having unpredictable market and income due to the lack of a central bank and the challenge of establishing a long term economic growth policies. Middle class counties are those who's revenue is between 1025-12475 dollars or 31.1 percent of the global income. 69.5 percent of the world are medium class counties, “Challenges faced by these middle-income countries are a legacy of government economic controls that for political reasons can be dismantled only slowly over time” (Openstax,2015). Meaning, that grow is not permanent and can be undercut by personal interest in political affairs. Medium income countries tend to have well established health and welfare programs and focus on human capital, physical capital, and technological improvements to increase revenue. China has been a recent country to greatly improve its quality of life and standards of living through large amounts of savings, as well as, increase of exports over imports. Additionally, after World War Two China opened up to the free world and established an
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