Compare and contrast the great depression and todays great recession Essay

Compare and contrast the great depression and todays great recession - Essay Example Therefore, it is relevant to correlate historical experience of 20s with the current processes in the economy. In order to show distinctions and parallels between the Great Depression and the Great Recession, it is required to analyze the reasons of these periods in the American history, draw parallels between them in order to develop lessons for the future practical implementation of successful strategies and avoid mistakes of the previous years. Another supposed reason for the Great Depression is often found in banks collapse. When investors took away their money from the banks to pay debts, nearly 9,000 banks failed in less than 10 years. Therefore, a credit crisis occurred. Those individuals who had bank accounts lost their savings and businesses did not have an ability to expand. Furthermore, this drastic economic situation was also spoiled by a slow process of recession. People were afraid of spending their money and many companies had to decrease their production levels. As a result, a great number of unemployed people occurred. The American government managed to correct the challenging situation and introduced The Smoot – Hawley Tariff act of 1930. In accordance with this Act, American companies could easily trade with international companies and pay fewer taxes. Still, the government could not resist dust and drought storms, which devastated agricultural sector. As a result, the prices for food were high and p overty rates increased as well. As far as we can see, there are many parallels which can be found between the Great Depression and today’s Great Recession. Let us focus our attention on the reasons that triggered the Great Recession. In 2008 only 19 banks have experienced bankruptcy. In 1930, 744 banks failed. In 30s, banks were protected by the FDIC (Federal Deposit Insurance Corporation) (Chee-Heong Quah and Crowley, 2009). Still, this system is more beneficial for banks nowadays. In

Joseph Stalin Essay Example for Free

Joseph Stalin Essay World leaders are leaders with high governmental power in the world. Every leader, not just world leaders, is either great or corrupt; they are rarely both. Most of Russia’s history is filled with corrupt leaders. Joseph was one of those leaders. Stalin killed millions of people during his rule. But Stalin also led the Soviet Union almost to the top in world power. Stalin had many influences that led him to his Soviet Leadership in which gave him many admirers but even more non-supporters. At the age of 10, Joseph â€Å"Stalin† Djugashvili attended Gori’s religious elementary school. His mother, Yekaterina, wanted him to be a priest and would usually beat her son if he son whenever he misbehaved. These beatings were never as bad as those received from his father, Vissarion. Vissarion would frequently beat Stalin and his mother until they finally had enough and Yekaterina kicked Vissarion out. In 1894, at the age of 16, Stalin attended the Tiflis Seminary on a full scholarship. At the school, in 1899, he joined an underground Marxist revolutionary group. Because of his membership in this group, him and other revolutionaries were arrested and sent to Siberia. Two years later, Stalin escaped from Siberia. On his return, he joined the RSDLP or Russian Social Democratic Labor Party. Later, when the RSDLP split because of differences, he joined the Bolsheviks half under the control of Vladimir Lenin. With the Bolsheviks, Stalin helped with many revolutions. The first was the take down of Tsar Nicholas II and the Russian Tsarist government. With the tsarist takedown, Russia set up a new provisional government. It worked at first but then it started going downhill. Since fleeing the country in fear of arrest, Lenin put Stalin in charge of the central committee of the Bolsheviks Party. Unimpressed by Stalin’s compromising with the Provisional government, Lenin started writing hate letters to the provisional government. Most, if not all, of these letters were published in Stalin’s communist newspaper, Pravda. The Pravda was one of the ways the Bolsheviks spread the communist revolt. The Russian’s loss in the Russo-Japanese war was the another way that they got the public to turn against the provisional government and strengthen the communist revolt. The revolt got stronger and stronger until the Bolsheviks finally revolted and took down the Russian Provisional Government. Because of this, civil war erupted all over the country. At the end of this war, in 1920, the Bolsheviks set up the USSR, or Union of Soviet Socialist Republics, under control of Vladimir Lenin. When Lenin died, Stalin aggressively worked his way up until he was the leader of the USSR. In his control, Stalin set up a â€Å"5 year plan† to advance the Russian economy from just farming to also having industry. In this plan, he would also advance the military and â€Å"cleanse the country of villains† or those he saw as villains. To â€Å"cleanse the country†, Stalin would have unfair trials that would have many on trial at once. These were called his â€Å"Show Trials†. The majority, if not all, of these people were found guilty and sent for execution. They were executed all at once, and the executions were called the Purges. To advance the Russian economy, Stalin would work the farmers to death†¦ literally. When the farmers revolted, Stalin stopped sending them food and even more died from starvation. On the last of the purges, 16 men were put on trial and accused of acts of terrorism towards Stalin and the Soviet government. Two of them were Stalin’s allies after Lenin’s death, Zinovyev and Kamenev. All 16 of them confessed although none they were innocent. One of the accused that wasn’t sent to execution was Robert Eikhe. Eikhe wrote a letter to Stalin saying that Stalin was wrong and shouldn’t have executed those men. Furious, Stalin demanded that Eikhe was shot to death. Not too long after, Stalin’s wife died. With that, Stalin will never truly trust anyone or ever be the same. In Europe, there was another leader rising to power, Germany’s Adolf Hitler. Stalin admired Hitler and, in WW2, hoped they wouldn’t have to fight, so the USSR and Germany signed a Nonaggression Pact to avoid battle between them. It wasn’t too long until Hitler broke the Pact and attacked Ukraine. During the invasion, the Soviet air force was wiped out. Feeling surprised and betrayed, Stalin had a mental breakdown. Stalin finally pulled himself together and set up a â€Å"Scorched Earth† policy. He had both soldier and citizen initiate this scorched earth policy by destroying everything the Germans needed in their area and push out the invading Germans from Ukraine, which was taken under German control. Many were killed in the invasion; the Germans captured four million and killed three million people. Then the Soviets started fighting back. In that winter, many Germans died because of harsh weather and lack of supplies. Towards the end, Roosevelt sent weapons, equipment, and food to the Soviet Union. Stalin launched his final attack on the Germans in Stalingrad. At the end of WW2, Germany was left with nothing and no one in control. The â€Å"big three† (The United States’ Franklin D. Roosevelt, Joseph Stalin, and Britain’s Winston Churchill) met in Yalta, Ukraine. In Yalta, they discussed many topics. One of them was about Germany. They split Germany into four parts. The four parts were under control of the USSR, USA, Britain, and France. They also talked about Roosevelt’s preposition and set up the United Nations. The effects WW2 had on the Soviet Union were drastic. People would have their houses destroyed and had to live in their caves. The food rationings for the poor would continue for a while. Stalin knew nothing about it. It got worse when the United States stopped sending supplies. Because of this, Stalin declared war on the United States and its allies. This war would was called the Cold War. At that, the Soviet Union started developing nuclear technology and tension escaladed. Not too long after, United States President Harry Truman set up the â€Å"Marshal Plan† which had no trade sent to the Soviet Union or any other communist country. A little after that, Germany was officially split into two parts, East and West. East Germany and East Berlin was under Soviet Control. West Germany and West Berlin was under United States, British, and French control. Stalin blockaded East Berlin from the West. Knowing the end of this life was near, Stalin did many things to make sure he would be remembered. He wrote a 16 volume set of books, and he built canals and bridges to â€Å"show his control over nature†. Many of the projects were unfinished, though. Not too long before his death, Stalin accused seven doctors of planning to kill him and other governmental officials that were their patients, and put all seven on trial. On March 1st, 1952, Stalin suffered a stroke caused by a burst blood vessel in his brain in his mansion outside Moscow. He died four days later. After his death, Stalin still had many supporters. The Supporters mourned the loss of their great leader. They disregarded the millions of murders or say that they were for the better of the country. They also believed that some of the negative information was fake and still remain loyal to him. Other people that were non-loyal to Stalin were glad that he’s gone. The non-supporters renamed the bridges and streets he named after himself. They also renamed Stalingrad to Volgograd. The propaganda Stalin used didn’t completely work. He tried having history books rewritten to make him look peaceful because despite the terror, he wanted peace to be part of his remembrance. Stalin would have picture taken and paintings made of him doing good or kind things. He would also say things to make it look like his murders were okay. In one of his speeches, he said â€Å"A great danger hangs over our country. † (â€Å"Stalin, Joseph 1878-1952† 205) He says this for his multiple 5 Year Plans and his Purges. Joseph Stalin will always be known as the man who changed Russia. He evolved the working class country into an industrial, Military-strong country. His goals for Russia and the Union were good, but the ways he reached those goals weren’t so good and that’s why many people didn’t like him. The opinion of Stalin that I had was that he was a terrible ruler and that he thought for the worst; that changed. I learned that he wanted to advance Russian economy from farming to more industrial factories and that gave me more respect towards him, but I still think he could have done better.

The Government’s Spending Review 2010 :: American Government, Budgeting, Spending Plans

The Government’s Spending Review 2010 The way the government sets out its budget is through allocation of monies to different governmental departments. These departments then allocate monies for services such as, health, defence, welfare benefits etc. â€Å"The Spending Review is the way that the Government sets spending plans for each department over a period of several years† (Anon, 2010)[1]. On 20th October 2010, the Government announced substantial UK spending cuts with local authorities, police, defence and welfare budgets all reduced. As a result the Government intends to â€Å"cut  £81 bn from public spending over four years† (BBC, 2010)[2]. Up to 500,000 public sector jobs could go by 2014/15, as a result of the cuts programme, according to the Office for Budget Responsibility (HM Treasury, 2010)[3]. Over the last few years the gap between what the Government took in as income and what it had to borrow to spend on services grew significantly. The yearly gap between the Government’s income and what it spends is known as the ‘deficit’. In recent years this deficit has grown in size. The key outcome from the Spending Review 2010, was to set in train a process of cutting the deficit and to make it more manageable and affordable in the future years. The government intends to do this through, reduction in government spending, such as, savings from welfare reforms and increases in taxation, e.g. the increase in VAT to 20 percent in January 2011 (Williamson, 2010)[4]. In the UK the Government obtains its income mainly from taxation, National Insurance contributions and excise duties. Due to the recession which began in 2008, the Government’s income dropped, but Government spending continued to increase. The deficit last year (2009/10) was  £155 bn (Anon, 2010)[1]. This is the amount of additional money the Government had to borrow to be able to pay for its spending on governmental activities last year. Macroeconomics The UK Government is pinning its hopes in the growth of the British economy, to help increase its income from taxation and by reducing the size of the public sector. The Office for National Statistics (ONS,2010)[5], confirmed in its press release on 24th November 2010, that the â€Å"UK economy grew at 0.8% between July and September 2010†. The 0.8% figure represents a slow down from 1.2% in the second quarter, but is still better than had been expected in the summer (Grierson, 2010)[6].

Archetypes and Their Influence on the Personality Essay

Carl Gustav Jung (1875-1961) was born on July 26, in the small village of Kesswil on Lake Constance. He was named after his grandfather, a professor of medicine at the University of Basel. He was the oldest child and only surviving son of a Swiss Reform pastor. Carl attended the University of Basel and decided to go into the field of psychiatry after reading a book that caught his interest. Jung became an assistant at the Burgholzli Mental hospital, a famous medical hospital in Zurich. He studied under, and was influenced by Eugen Bleuler, a famous psychiatrist who defined schizophrenia. Jung was also influenced by Freud, with whom he later became good friends. Their relationship ended when Jung wrote a book called â€Å"Symbols of Transformation. † Jung disagreed with Freud’s fundamental idea that a symbol is a disguised representation of a repressed wish (Heaney, 1994). After splitting up with Freud, Jung had a 2 year period of non-productivity, but then he came out with his â€Å"Psychological Types,† a famous work. He went on several trips to learn about primitive societies and archetypes. His explorations included trips to Africa, New Mexico to study Pueblo Indians, and to India and Ceylon to study eastern philosophy. He studied religious and occult beliefs like I Ching, a Chinese method of fortune telling. Alchemy became one of his interests during his journeys. His book, â€Å"Psychology and Alchemy,† published in 1944, is among his most important writings. In this study, he told about the human mind. One of his methods was word association. This is when a person is given a series of words and asked to respond to them. Abnormal response or hesitation can mean that the person has a complex about that word. His basic belief was in complex or analytical psychology. The goal is psychosynthesis, or the unification and differentiation of the psyche (mind). He believed that the mind started out as a whole and should stay that way. That answered structural, dynamic, developmental questions. Jung is best known for his theory of â€Å"The three levels of the mind† (Aurelio, 1995). Discussion The three levels of the mind theory includes the ego (conscious), personal unconscious, and collective unconscious. The conscious level serves four functions. It is the part of the personality that carries out normal daily activities: thinking, feeling, sensing, and intuiting. The personal unconscious contains an individual’s memories, and the collective unconscious is an inaccessible layer that contains universal experiences. Usually, one of the two classes usually dominates, and rarely does one see an individual with perfectly balanced classes of behavior (Nehr, 1996). Jung said that an ego is a filter from the senses to the conscious mind. All ego rejections go to the personal unconscious. The ego is highly selective. Every day we are subjected to a vast number of experiences, most of which do not become conscious because the ego eliminates them before they reach consciousness. â€Å"The personal unconscious acts like a filing cabinet for those ego rejections† (Jurkevich, 1991,p. 58). Clusters of related thoughts in the personal subconscious form complexes. Complexes are really suppressed feelings. Complexes are often highly visible to people, but unfelt by the individual who has the complex. Complexes can be revealed by word association, which will cause hang-ups if a certain word is mentioned. A strong or total complex will dominate the life of a person, and a weak or partial complex will drive a person in a direction of it, but not too strongly. A complex, as Jung discovered, need not be a hindrance to a person’s adjustment. â€Å"They can be and often are sources of inspiration and drive that are essential for outstanding achievement† (Aurelio, 1995, p. 351). â€Å"The collective unconscious is hereditary. It sets up the pattern of one’s psyche†(Kremer, 1990, p. 2). An inherited collection of primordial images are stored here. They are universal inclinations that all people have in common somewhere by means of heredity. The four important archetypes that play very significant roles in everyone’s personality are Persona, Anima(us), Shadow, and the Self. Persona is derived from the Latin word meaning â€Å"mask†. In Jungian psychology, the persona archetype serves a similar purpose; it enables one to portray a character that is not necessarily his or her own. The persona is the mask or facade one exhibits publicly, with the intention of presenting a favorable impression so that society will accept him (Nehr, 1996). Anima and Animus is what Jung referred to as the â€Å"inward face† of the psyche. The â€Å"inward face† he called the anima in males and the animus in females. The anima archetype is the female side of the masculine psyche; the animus archetype is the masculine side of the female psyche. Man has developed his anima archetype by continuous exposure to women over many generations, and woman has developed her animus archetype by her exposure to men (Heaney, 1994). According to Mannis (1997), the â€Å"Shadow† is what Jung referred to as â€Å"the negative side of the personality, the unpleasant qualities we like to hide†. When one is not conscious of their â€Å"shadow†, they give it more power. â€Å"Usually, the qualities we dislike the most in others, are the unknown qualities in our shadow† (Kremer, 1999, p. 4). â€Å"The self represents all archetypes working together† (Heaney, 1994, p. 29). Jung used the words extraversion and introversion to show how one’s personality is. Those who lean towards extraversion are usually socially accepted. They are outgoing and very sociable. Those who lean towards introversion tend to keep to themselves and are not very sociable. One’s psyche works together three ways. One structure may compensate for the weakness of another structure (Jurkevich, 1991). One component may oppose another component, and two or more structures may unite to form a synthesis. Compensation may be illustrated by the contrasting attitudes of extraversion and introversion. If extraversion is the dominant or superior attitude of the conscious ego, then the unconscious will compensate by developing the repressed attitude of introversion. Compensation also occurs between function. A person thinking or feeling in his conscious mind will be an intuitive, sensation type unconsciously. This balance is healthy and it prevents our psyches from becoming neurotically unbalanced. Opposition exists everywhere in the personality: between the persona and the shadow, between the persona and the anima, and between the shadow and the anima. The contest between the rational and irrational forces of the psyche never ceases. One’s integrity of â€Å"self† can actually determine whether or not this opposition will cause a shattering of a personality (Heaney, 1994). I decided to do my research on Carl Jung because he is not discussed much in the textbook. I find his theory of conscious and unconscious very interesting. I believe the thoughts of persona and ego without a doubt. When one’s ego is shot down, a person can tend to develop a complex about it. I also agree that people tend to have a different persona based on where they are at and how they are expected to act around certain people. References Aurelio, Jeanne M. (1995). Using Jungian archetypes to explore deeper levels of organizationalculture. Journal of Management Inquiry, 4, 347-369. Heaney, Liam F. (1994). Freud, Jung and Joyce: Conscious connections. Contemporary Review,265, 28-32. Jurkevich, Gayana. (1991). Unamuno’s intrahistoria and Jung’s collective unconscious: parallels,convergences, and common. Comparative Literature, 43, 43-60. Kremer, Jurgen W. (1999). Facing the collective shadow. Revision, 22, 2-5. Mannis, Robert F. (1997). Jung and his shadow. Utne Reader, 84, 91-94. Neher, Andrew. (1996). Jung’s theory of archetypes: a critiques. Journal of HumanisticPsychology, 36, 61-92.

Pip and Estella Essay

Chapter 33 opens with Pip again showing how obsessed he is with Estella. He says however, â€Å"even in my eyes† suggesting that he realises that he sees her in a better light than anybody else for example Herbert says in chapter 22: â€Å"She’s a Tartar†. Pip notices a change in her mannerisms in this visit, only the second time the two have met since adulthood. Pip again shows that he knows she is different around him to around other people as he says, â€Å"cared to let it be to me†, he seems to know, or at least believe that she is ruder, more insulting and supercilious in Pip’s company than that of people in her social circle, or of class. Throughout this chapter and chapter 29, even though both Pip and Estella are adults now, we see the influence of Miss Havisham. Estella blames her actions upon her being made to follow the unknown orders of Miss Havisham; â€Å"and I write in obedience to it† suggests that Estella is otherwise unwilling to have any contact with Pip at all, and she wants him to know this. Estella also says; We have no choice, you and I, but to obey our instructions. We are not free to follow our own devices, you and I. which suggests that she is unhappy. This is interpreted badly by Pip as to mean that she wants more between them than is allowed, whereas she could mean exactly the opposite. Pip recognises however her reluctance and an awkward air of orders being carried out when he says; She drew her arm through mine, as if it must be done As a child Miss Havisham always encouraged Pip to like Estella with influential dialogue such as â€Å"And never see her again, though she is so pretty? â€Å". But it becomes dramatically apparent that Estella wants to discourage Pip from following Miss Havisham’s encouragements; ‘Will you never take warning? Or do you kiss my hand in the spirit I once let you kiss my cheek? ‘ and although she seems to have started off the visit quite mannered and nicer to Pip she soon returns to arrogant and supercilious with lines such as; ‘you must not expect me to go to school to you; I must talk in my own way. ‘ which also suggests that she is trying to distance herself from Pip. However she does seem to show a trust and dependence upon Pip when she entrusts him with her purse and although she does so coldly, holds his arm. Is that just a way to lure him? Pip is well aware that she tries to lure him as he says in Chapter 29 â€Å"She treated me as a boy still, but she lured me on†. But even this sense of Estella trying to manipulate Pip as Pip now knows is the plan of Miss Havisham does not dissuade him as he says; It was impossible for me to avoid seeing that she cared to attract me; and that she made herself winning; and would have won me even if the task had needed pains. he obviously knows the intentions of Miss Havisham â€Å"to wreak revenge on all the male sex† when he continues with she held my heart in her hand because it would have wrung any tenderness in her, to crush it and throw it away. In Chapter 33 she calls Pip a â€Å"silly boy† as a derogatory term, echoing earlier episodes when she regularly referred to him, although a peer as â€Å"boy†. Although actually for the first time in the novel she also called him â€Å"Pip†. Is this Estella purposely trying to make Pip think they are closer or their relationship has changed in some way, maybe more intimate than before in the novel. Throughout the chapter Estella remains quite composed and a strong character whilst Pip explicitly hints at his feelings towards Estella and drifts off into daydreams; â€Å"having forgotten everything but herself†, he obviously has stronger feeling towards her than her feeling to him, if she has any at all, which, although hinted at have not been explicitly shown. Even when we do see a hint that Estella does have feelings for Pip, we must also remember that Pip, as narrator, is biased, as wishful thinking possibly. As a very small point, but one that may show a point in the story of importance, Estella says â€Å"kiss my cheek† whereas Pip says â€Å"kiss the cheek† could this be Pip trying to distance himself from Estella, show a hardening to her temptations? Pip says; Her reverting to this tone as if our association were forced upon us†¦ gave me pain†¦ Whatever her tone with me happened to be, I could put no trust in it, and build no hope on it; which tells the reader that he is hardening to her effects, but Pip obviously adores her too much when he continues; I went on against trust and hope continuing the idea that he does not just love her, but has become obsessed by Estella. However, it is made explicitly obvious that she can certainly live without Pip and intends to do so. But she continues to, obvious to the reader if not to Pip, encourage his beliefs of her mutual feelings when she says â€Å"indeed you are already mentioned† which suggests to Pip that he is considered by Estella often, although we do not know who mentioned Pip, as it could just be the plans of Miss Havisham for Pip to visit. If the reader views Estella as completely manipulative and heartless, then this being the first time in the novel that she calls Pip by his name could be seen as Estella trying to drag Pip further into her net and Pip realise this, although he still continues to let it work. Chapter 33 is a key point where Pip realises Estella’s true intentions, or at least begins to see through her plans. Show preview only The above preview is unformatted text This student written piece of work is one of many that can be found in our GCSE Great Expectations section.

Critical Thinking Essay

Critical Thinking Essay Critical Thinking Essay What is Critical Thinking? Aaron Moore Axia College of University of Phoenix . What is Critical Thinking? Does every need to think critically? Yes! If everyone just made assumptions on how they could do things, the world would be in chaos. Critical thinking is what helps everyone in his or her day-to-day decisions. No matter how big or small the decision everyone thinks critically. Critical thinking is basically making wise decisions. In our reading making wise decisions is to â€Å"not being way- laid by temptation, emotion, greed, irrelevant considerations, stupidity, bias, or other similar things. â€Å" (CHAPTER 1: WHAT IS CRITICAL THINKING, ANYWAY?) While making a decision, and you let your emotions get the better of you, you may regret your outcome later. The same can be said for greed and temptation. Say you want to buy new clothes, but you know you need your money for other things. What you need and want are not always the same. So if you let your want out beat your need, you may be hurting in the end. Rational decisions, without thinking clearly could create a big mess. Like the story of the teenager who decided to run away from the cops. He thought rational, but didn’t think everything through. And as everyone knows, if you run from the cops it just adds to the felony. But if the teenager had just thought everything though while being read his rights, the teenager probably would have realized

In 2009 the United States Government Spent $950 Billion in a Fiscal Stimulus Package Essays

In 2009 the United States Government Spent $950 Billion in a Fiscal Stimulus Package Essays In 2009 the United States Government Spent $950 Billion in a Fiscal Stimulus Package Essay In 2009 the United States Government Spent $950 Billion in a Fiscal Stimulus Package Essay In 2009 the United States Government spent $950 billion in a fiscal stimulus package. Discuss the extent to which this stimulus will affect output, unemployment and inflation. (18 marks) Before we look into how the United States Government investment in a fiscal stimulus package effects output, employment and inflation, we must ensure we understand what is meant by a fiscal stimulus or policy. It is defined by economists as a package of economic measures put together by the government to stimulate a struggling economy. The objective of a stimulus package is to revive the economy and prevent or reverse a recession by boosting employment, spending and output. [INSERT DIAGRAM HERE] With large investment being placed into a new fiscal stimulus package, the resulting injection will significantly effect the level of economic output. However, the significance of this change depends greatly upon the positioning of the macro-economic equilibrium before the stimulus. This stimulus package qualifies itself to be a form of fiscal policy, and therefore a form government spending, which is a component of aggregate demand. Therefore due to this large monetary injection from behalf of the AD curve will undergo a rightward shift. That said, as demonstrated on the graph above that the economy is far from reaching full capacity utilization, therefore a shift right in the AD curve has very a slight effect on price level however, a significant change in real GDP. This is due to the fact the economy is still operating on the elastic side of the curve. Moreover, there is the possibility of a rightward shift in aggregate supply as a result of the stimulus injection. This therefore as a consequence will encourage firms to meet the demands of the surge in the aggregate demand curve through the purchase of capital goods in aid of production, new forms of technology and further investment in order to increase capacity utilization. Thus increasing economic output. [INSERT DIAGRAM HERE] As represented in the graph above, a rightward shift in the aggregate supply curve results in a decrease in the price level due to the increase in the given output level therefore, resulting in a further increase in real GDP. However, the degree of this shift depends greatly on the marginal propensity to consume (MPC) and the level of confidence of firms going forward. If there is a lack of confidence and low overall MPC on behalf of firms there will either cease to be a shift in aggregate supply or there will be a very small shift. The stimulus package will also have a direct effect on the level of employment within the economy. However, the effect depends greatly on the confidence of firms and other economic organisations. If confident firms will want to increase their overall output and therefore as a result will take on more employees to enhance the level of total output which can be reached (capacity cultivation). This will consequently decrease the level of unemployment within the economy, and mean there will be less government expenditure aimed toward benefits or job seekers allowance. However in retrospect, if firms lack confidence and have a low overall MPC to prevent them investing in ways to increase their overall output, such as capital goods and increasing the labour force unemployment will see no decrease or will only increase marginally. INSERT DIAGRAM HERE] The rate of inflation within the economy will be bound to see a change as a result of the stimulus injection. If we continue to assume that the macro-economic equilibrium is situated by the elastic part of the aggregate supply curve, therefore a rightward shift in aggregate demand will have a very minimal effect on the price level and inflation, however great effect on the real GDP figure. In addition there might even be possibility of a decrease in the price level if the aggregate supply curve shifts right whilst firms simultaneously invest in capital goods and labour force growth. However, this theory depends strongly on the fact that firms have high confidence and MPC. If the macro-economic equilibrium was positioned or was reaching the inelastic segment of the aggregate supply curve, there would be a substantial increase in the overall price level however no or minute change in real GDP. This would result in a negative impact on the economy as the level of output would receive no change however, the price level would. This would therefore mean the population would have less real disposable income, or RDI, available to them this decreasing the MPC and consumer confidence as less can be consumed. The impact on consumers would mean that firms would have little confidence and therefore, wouldn’t invest in means of increasing their output potential. This meaning the aggregate supply curve would see no change and inflation would as a result increase significantly. The multiplier effect also possess great significance in regards to the overall economic impact the stimulus will have on the United States economy. However, before analysing the importance of the multiplier effect, we must be sure we have a thorough understanding of what it means. It is defined by economists as, the process by which any change in a component of AD results in a greater final change in real GDP. In the case of the huge injection from the stimulus package it is more than likely there will be a multiplier response. The injection will cause a surge in economic activity causing a shift in aggregate demand as a result. However, this depends on the number of leakages stemming from, savings, imports and taxes, and the overall size of these leakages. If confidence is high amongst firms and consumers is high it is therefore unlikely that savings will take place as there will be a high overall MPC, the proportion of total RDI that they spend on goods, services and capital aids to production. . However, if there is an overall low level of confidence there will be an increase in the total amount of leakages from the circular flow as there are lots of savings taking place. As a result, this will decrease the multiplier effect. That said it is also worth noting that there may be an increase in imported goods and services as well as a change in taxation which would cause further leakages within the circular flow, thus hindering the impact of the multiplier effect. Therefore in conclusion, it is clear that a fiscal policy injection of this magnitude will create a definite macro-economic change especially in areas concerning output, unemployment and inflation. However, it is only certain that this change will be positive if the macro-economic equilibrium is situated on the lower elastic segment of the aggregate supply curve. If this is not the case the change could well cause economic issues (shortfall) such as high inflation. In addition, the increase in output of the economy depends upon the confidence of firms and consumers and an overall high MPC must be reached in order to ensure the best effect on the economy. This will encourage the purchase of capital goods and an increase in the size of the labour force in order to increase output. However, we must also take into consideration the role of the multiplier effect and as to how an increase or decrease in the volume and level of leakages will impact the economy and the overall effect of the stimulus package.