Overcoming Development Barriers: Capital, Population, and Institutions
Barriers to Economic Development
Lack of Capital
The availability of factors of production (capital and labor) limits potential economic growth. A country can grow quantitatively by incorporating additional units of production. However, for it to be considered economic development (qualitative), productivity must increase. This is a consequence of rising efficiency in the use of available resources, allowing workers’ incomes and spending power to increase.
The increase in Total Factor Productivity
Read MoreUnderstanding Stock Face Value, Capital Increases, and Bonds
Face value of a stock: The value that appears in the account. This value is set at the time of the stock’s issuance. It’s calculated by dividing the total share capital by the number of shares issued when the company was created.
Capital Increases
To increase share capital, a company issues new shares. These new shares are first offered to current shareholders; this is known as pre-emptive rights. If shareholders don’t exercise this right, the shares can be acquired by others.
If the starting price
Read MoreSecond Republic Spain: Social, Economic Policies & 1930s Depression
Social and Economic Reforms in the Second Republic
The Second Republic sparked conflict between opposing ideologies. It raised expectations for farmers and industrial workers, aiming to improve their living standards.
Economic Policy: Advocates for the gold standard persisted, overvaluing the peseta and hindering imports and exports.
Innovative measures led to increased business costs.
- Budget Deficit: The deficit was addressed with public debt but did not reach critical levels, as investors withdrew
Inflation: Causes, Measurement, and Economic Impact
Understanding Inflation: Causes and Measurement
8.1 What is Inflation?
Inflation is the continued and widespread increase in the prices of goods and services in an economy over a period of time. A core problem that any economy must solve is inflation. If prices rise, fewer goods can be purchased with the same amount of money. When economies become increasingly interdependent, rising prices in one economy (and not in others) means that it sells fewer goods and services to others and buys more products
Read MoreSelf-Financing and Short-Term Financing for Businesses
Self-Financing for Businesses
While pursuing enrichment, self-financing company growth, this is still its productive capacity. This form of self-financing is composed of both the funds that the company intended to go to paying off their equipment and renew as resources or funds set aside to meet future contingencies and risks.
Key Components of Self-Financing
- Depreciation: Production teams lose value over time due to use or technological obsolescence. This loss of value, or depreciation, is reflected
Distribution Channels and Retail: A Detailed Analysis
Definition of Distribution
Distribution is the set of operations needed to make products and services available to those who will consume or use them.
Distribution Channels
Channels are the different paths that products take in the process from the producer to the consumer or end-user. The process can be short or long, depending on the number of intermediaries involved.
Effects of Channel Length
- Direct Channel: The company controls the entire marketing process at a low cost. This type of channel is used