Mindblown: a blog about philosophy.

What is the meaning of real income? If a person was earning $1,000 in 2007 and in 2015 his salary increased to $1200 whereas there was an increase of 25% in the rate of inflation. If you look at the salary you would know that there was an increase of $200 whereas in real terms…

Balance of payments Balance of payment is the difference between the exports and imports of the country. If the exports are more than the imports that would be considered to be positive balance of payment and imports are going to be considered to favorable for the country.

Economic growth Economic growth occurs when more good and products are produced in a country. For instance of country A was first manufacturing 10,000 cars and if now it increases its production to 40,000 cars that would be considered economic growth as that would be increase in the Gross Domestic Product.  

Unemployment Unemployment is a situation when people between the ages of 16 and 65 are willing and able to work, yet cannot find a job. People working for their own businesses would not be considered unemployed.

Inflation Inflation is the increase in the general price level. If there is going to be an increase in one product that would not be considered inflation.  If there is going to be an increase in the price of petrol that could lead to inflation as the increase in the price of petrol is going…

What is the role of government in business activity? Governments are incessantly endeavoring to render to favorable conditions to promote business activity and they are also indulged in the activity of reducing the demerits and promoting the merits of business activity.  

Demerits of business activity for environment Businesses which are associated with the industrial sector would be damaging the environment by emitting pollution. People would also be affected by this as they would give rise to health problems.

Demerits of business activity for people It is true that the business provides different products, but at the same time if the business is big it might be able form a monopoly and charge whatever money the business wants. People might also be misinformed or misguided by the extensive marketing campaign by the businesses.

Benefits of business activity for the economy When the business would be operating it would also be doing business with other countries thus earning foreign exchange by exporting the products. With more business operating there would also be an increase in Gross Domestic Product.

Benefits of business activity for government The government would be earning taxes as all businesses are required to pay taxes. The government would also be relieved of one of its objectives which is low unemployment as the business would be helping the government solve this problem.