Questions On Economics

Submitted By nikolaus11
Words: 406
Pages: 2


1.)Consumers still want to buy products and services regardless if their employed or not. They find means of buying their product with credit or loans. Although employed consumers don’t have income they are still able to buy goods and services due to government aid, for example food stamps. In a sense, people are still buying what have always bought although they may not technically be able to afford. Another scenario could be an example where people may invest their money instead of spending it, therefore GDP would stay the same.
2.) Employment in agriculture would have a positive effect on poverty rate and unemployment because an increase in agriculture production would lead to cheaper supplies which in turn would lower poverty because the goods are less expensive. Employment in industry would have a negative effect on the poverty rate because workers are easily replaced due to the assembly line setting of the industry setting. Jobs in the industry work often don’t require much skill therefore people lose jobs more easily.
3.) Yes, Unemployment would have a negative impact on GDP because the unemployed will not have an income to spend. GDP indicates how many goods and services are being bought and sold therefore if the unemployment rate is high, people will not have salaries to spend on goods or services.
4.) GDP is an indicator of growth in an economy. Investors are looking to make profit when they invest therefore pay great attention to the economic state before investing. Investors are less likely to