Economic Health Memo Ã¯Â¿Â½ PAGE \* Arabic Ã¯Â¿Â½2Ã¯Â¿Â½
Running Head-ECONOMIES PRODUCTION THROUGH BUSINESS CYCLE
University of Phoenix
As determined the quality of life through GDP let us first understand GDP, "the market value of all final goods and services produced in a year within a country" (Boyes & Melvin, 2002). There are many indicators that are measured, for example, as the rate of economic growth picks up, businesses produce more. This can be straightforwardly or indirectly with the business cycle. As businesses produce more, more resources are needed and employment rises. As employment rises, so does consumer's incomes and more important expenditures rise increasing growth in GDP. With a higher production and a rise in employment the value of GDP would be higher for the nation's production in business. Once GDP is higher, we can assume the better quality of living for that nation.
GDP does not truly measure the exact quality of life in a country as it ignores several other factors. There are other factors such as leisure, environment, underground economy, crime and safety, health, etc. These factors can not be determined even if the countries GDP is in the top rankings, as the business cycle can be expanding or at its peak.
The government has several roles to determine the fiscal policy which involves both the executive and legislative branches. Each have a very important role, we first begin with the president who directs the federal agencies to prepare the budget for the year. Once the agency submits the budget to the office of management (OMB), the OMB reviews and modifies the consolidated budget and sends the report back to the president. The president then receives the report once again and presents it to congress. Once congress receives the budget report,