Understanding Inflation, Fiscal Policy, and Government Budgets
Understanding Inflation
Inflation: is a general increase in prices.
CPI: [(Current year CPI – Previous year CPI) / Previous year CPI] * 100
Core CPI: CPI less the evolution of unprocessed foods and energy products.
GDP Deflator: [(Current year deflator – Previous year deflator) / Previous year deflator] * 100 or (Nominal GDP / Real GDP)
Causes of Inflation
Inflation occurs due to:
Increased Demand
- Monetarist View: Inflation occurs when the money supply increases beyond production increases.
- Keynesian View:
Understanding Michael Porter’s Competitive Advantage Theory
Michael Eugene Porter: A Brief Biography
Michael Eugene Porter (born 1947) is an American economist, professor at Harvard Business School, specializing in management and business administration, and director of the Institute for Strategy and Competitiveness.
Porter earned a Bachelor of Arts in Mechanical and Aerospace Engineering from Princeton University (1969), an MBA from Harvard University (1971), and a Ph.D. in Business Economics from Harvard University (1973).
Strategic Management Theory
His main
Read MoreNatural Resources, Capital, and Financial Markets
Market for Natural Resources
In the market for natural resources, the reward (income) in the short term is determined by the assumption that the amount of natural resources in an ecosystem is constant. The price equilibrium depends solely on demand (DDA). This implies that resources are not depleted overnight. Income from human resources is determined not by the price of the resource itself, but by the price derived from using it (i.e., the value of its yield). Therefore, natural resources are assigned
Read MoreITC-3: Electrical Load Calculation in Buildings
ITC-3: Classification of Consumption Points
The following classification of consumption points is provided:
- Buildings used primarily for housing
- Commercial or office buildings
- Buildings for a specific industry
- Buildings for a concentration of industries
Electrification and Estimated Power in Homes
The maximum load per household depends on the degree of utilization to be achieved. The following degrees of electrification are established:
Degree of Electrification
Basic Electrification
It is necessary to cover
Read MoreBusiness Ratios and Finance: Key Insights
Profitability Ratios
Profitability ratios compare the profits of a business with its sales revenue.
Profit Margin Ratios
Profit margin ratios are used to assess how successful the management of a business has been at converting sales revenue into gross and net profit.
- Gross Profit Margin: Compares gross profit with sales turnover (Gross Profit / Sales Revenue * 100). A good indicator of how effectively managers have added value.
- Net Profit Margin: Compares net profit with sales revenue (Net Profit /
Understanding Sustainability: Key Concepts and Practices
Understanding Sustainability
Sustainability is a balance between:
- Social equity: People.
- Environmental protection: Planet.
- Economic development: Profit.
Global citizen is the umbrella term for social, political, environmental, and economic actions of globally minded individuals and communities on a worldwide scale.
Sustainability:
- Development that meets the needs of the present without compromising the ability of future generations to meet their own needs.
- Improving the quality of human life while living