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Multiplier effects exist in the economy because a dollar saved is a dollar earned, but a dollar spent that doesn’t get consumed grows. For example, when a film goes into production, most of the financing is done with pre-tax dollars that are sold to free investors at a discount. The incentive is the tax savings. It’s hard to say how the investment is creating a specific multiplier, but it is well understood that these local tax savings create pockets of spending where the production is shot. Let’s say a film has just received a local grant or stipend of $10,000. This money will be spent almost entirely in the local region where the film set is at. If the production goes to Germany, which is common due to good tax incentives, that money is exchanged for £8,300 and spent in the location of where the film is being produced, in this case, somewhere in Germany. That is a new injection of cash, which goes into the entire cycle of a multiplier for consumption. One important part of the divisor for calculating the multiplier is the “Marginal Propensity To Consume”. The multiplier for consumption is calculated as follows: Let’s say the marginal propensity to consume is equal to 95% of a sin…
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NAG 15 May

отличная статья)))

pshan avatar
pshan 16 May

Thanks!

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AAAnya 19 May

Thanks for sharing)

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21/26
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Although this week may have been a good rally week for the dollar, the medium-to-long run factors could divide a solid base of fundamental strength. The number one factor stemming from the employment situation. Due to some favorable economic news overall, an increase in interest rates, and geopolitical stability with a campaign in Syria, things are currently looking up for dollar bulls, but something worth pointing out are the multiplier effects able to contort the U.S. and world economies in the medium-to-long run.
In a previous article, "Mixed Signals For The U.S. Dollar" , I had pointed out some visible disparities for policy making, pointing to choppy trading for the dollar in February and March of this year.
This disparity in policy making can be seen clearly with increased government spending, versus a protectionist stance in trade. On one hand, the economy gains from increased government expenditures; but, on the other hand, the economy suffers a loss from decreases in net exports.
Well, in this article, I argue that these disparities will result in a dramatic divergence in calculating overall averages for GDP growth. When I say dramatic divergence, I do mean an extreme divi…
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AAAnya 10 May

Nice!

vugarali avatar
vugarali 13 May

good article

mcquak avatar
mcquak 14 May

Very well fundamental article. Good job.

AS_binary_option_trader avatar

Хорошая статья!!!!!!!!!

Dominos avatar
Dominos 23 May

good article

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