(MACROECONOMICS) Explain why the actual budget deficit is not a good Essay

(MACROECONOMICS) Explain why the actual budget deficit is not a good indicator of the fiscal stance and suggest any other better alternatives - Essay Example Moreover, ideal and functional fiscal stance indicators should embrace in-depth analysis of fiscal policies and collective economic variables. The actual budget deficit has from time to time been used as an indicator of the fiscal stance, although various shortcomings have rendered it a rather inadequate indicator. The overall balance of a government budget is basically a measure of the difference between government expenditure and revenue. In a case where expenditure outweighs revenue, the overall balance presents an actual budget deficit, which is an indication of an expansionary fiscal stance. The actual budget deficit indicates a fiscal stance where the negative impact of revenue on an economy’s aggregate demand is far much implicative of the positive effects achieved through government spending. Gross national product of any given economy at any given time is on the receiving end as it is negatively impacted by the fiscal policies put in place by the government (International Monetary Fund, 1989, p.76). However, the measure of actual budget deficit needs to be analyzed and judged more cautiously for accurate and relevant indication of the fiscal stance. In case keen judgment and analysis of the actual budget deficit measure is compromised, it ceases to act as a good indicator for the fiscal stance with respect to other economic variables. The actual budget deficit is also regarded as deficient indicator of fiscal stance, since it only offers impacts on aggregate demand perspectives and overlooks other economic variables such as economic sustainability, monetary stance, and growth aspects. Moreover, the actual budget deficit overlooks other economic complexities such as the manner in which the deficit is financed with regards to successive impact of the country’s economic variables. Fiscal impact complexities encompass the manner in which an actual budget deficit is financed among other special measures that are put in place to

Prepare a report for a UK fashion retailer that (1) identifies key Essay

Prepare a report for a UK fashion retailer that (1) identifies key relevant changes in the UK market (750words) and (2) suggest strategies and tactics that are - Essay Example The unemployment rate has increased to its highest level in 17 years, as a result disposable incomes will remain flat in 2009 and consumption is forecasted to reduce by 1.2% in 2009 with credit being hard to get. (BBC News Report, 2008). The reduction in disposable income may impact negatively on the fashion retail market, because people tend to curb spending on fashion items in favor of necessities such as food. On the positive side however, it is also possible that with the increasing difficulties in obtaining credit, more people will be unable to purchase big ticket items such as homes and will opt to spend their money on clothing and footwear instead. In a restrictive economic environment, supermarkets marketing fashion apparel are likely to enjoy higher levels of customer support as compared to specialist fashion outlets. (www.verdict.co.uk). With rising costs of gas and less of disposable income, consumers are likely to target their purchases to a supermarket where all goods are offered under one roof. Specialist fashion retailers may be faced with rising costs in rent, etc added to which the costs of sourcing products from China are likely to increase which could further decrease the margins available to specialists. (www.verdict.co.uk). Since the U.K. economy has been declining throughout the last three successive financial quarters, the value of the pound has been falling, thereby giving rise to outsourcing exchanges with smaller margins of profit. In such an environment, there is likely to be an increasing squeeze on midmarket retailers, many of whom may be forced to exit the market, since they offer neither low price for competitiveness, neither do they offer special value for their brands. Howard’s decision model shows that consumer purchase behavior is a component of (a)brand recognition (b) attitude towards the brand and (c) confidence in judging the