*Narrative analysis paper 3-4 pages and choose an artifact and write an analysis
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Question
*Narrative analysis paper 3-4 pages and choose an artifact and write an analysis using the elements of narrative analysis as components of a coherent thesis. I need to write an essay on this and please put everything in the essay
The artifact is something that is made by human being typically with some motivational interest.
As the topic has asked to choose an artifact, in economics you can choose Money, Bank, financial establishments or factories as artifacts.
As you need to do a narrative analysis which contains objective oriented descriptions and narrations of perspective, money would be identical economic artifact you can think of.
In this regard, you need to put up a coherent thesis and that may include:
*Money as a material, exchange medium, value developing agent
*Money growth and its utility
*Velocity of money and its impact on society
*Value of money- components or parameters affecting it
*Growth multipliers
*Money in circulation and its valuation
*Money as a foreign exchange and its global impact
*Increasing and diminishing utility impact
*Monetary policy and its impact on socio-economic-politico scenario
Explanation / Answer
Introduction:-
In the modern era, everything derives it values from money. The barter system which allowed for exchange of goods and services was flawed and the governments introduced systems that checked this and allowed for people to be able to buy products based on currency.
Today the entire society has evolved so much so around the concepts of money that it is possible to buy products across the globe with a blink of the eye. Further the concept of digital currency has also become extremely popular.
In the essay bellow I have tried to define all of the key points highlighted above.
Money as a material, exchange medium, value developing agent
Today everything that is sold develops its value from money. Why is something more expensive than others? Because the value of it is defined in terms of the money one has to pay to be able to buy the product.
The yardstick for value is given by money. And it helps in comparison of various products that are offered.
Now, for an exchange to happen the concept of barter doesn't exist. If the producer of a pant has to buy more silk to be able to produce the good. He will not sell his pants to the person who manufactures silk.
He will convert his pants into money by selling them and then use this money to buy more silk as and when needed.
Money growth and its utility:-
The growth of money is widely researched and talked about. Currencies are now becoming digital and are ever evolving. The concepts of Cryptocurrency are also very ripe and help in transacting anonymously over the internet.
Its utility can largely be found that from people to governments everyone use it as a medium of exchange and largely decides the buying capacity of each one. From a poor peasant to transactions among various countries involving trillion of dollars everyone requires money to be able to function.
Velocity of money and its impact on society:-
The velocity of the circulation of money refers to the "frequency of the monetary transactions in an economy."
This velocity helps in determining the level of economic activity within a society. The impacts on it also being very huge. An economy with free flow of money makes it possible for trade volumes to be higher.
This further would mean that the level of productivity and employment would be relatively higher. Meaning that then the technological advancements and level of education would also increase.
The velocity of money is a key connector to all social conditions that are present in an economy and the levels at which the normal residents of a country operate.
Value of money- components or parameters affecting it
The value of money is determined by the value of the currency in the country, it often is also called the exchange rate, and is of prime importance while deciding the international value of the currency.
Every country requires to trade with other countries and the value of money or how much one can purchase with a unit of the currency is very important. $ has emerged as one of the standards and strongest currencies over a period of time.
The value of money is derived by many factors such as level of economic activity, Interest Rate, Economic growth, Current account balance etc.
These factors help in deciding the value a currency has.
Growth multipliers:-
Growth multipliers are factors that multiply the growth that happens in an economy. The two major factors that affect growth multiplication in the economy are given by Marginal Propensity to Consume and Marginal Propensity to Save.
Saving give rise to money availability in banks which can further use this money as a means to provide loans, this help in multiplying the growth.
Further if the consumer’s tendency to consume goes up, the overall economic activity in a country would rise. This makes it possible for a growth multiplication effect to come into play.
Money in circulation and its valuation:-
Currency in circulation refers to the currency that is physically used to transact between consumers and businessmen at a given point of time.
It is calculated by looking at the overall transactions that happen in the economy over a period of time and overlooks the money stored in banks by people.
It is a large part of the overall money supply which also includes the latter.
It can be thought of as currency in hand meaning that it used to buy goods or services. It depicts the most liquid assets. The more money that leaks out of circulation and into longer-term investments, the less money is available to fund shorter-term consumption – which is a major component of GDP.
Money as a foreign exchange and its global impact:-
Money is widely used in foreign exchange transactions across the globe. While $ has become the standard today in terms of transactions and exchange taking place.
The global impacts of a change in value of currency has a big impact at the price at which goods can be sold or bought across the globe which effects all connected variables such as economic growth activity and others.
Increasing and diminishing utility impact:-
Utility is the amount of satisfaction that a consumer gets by consuming one unit of the good or service that is provided to him.
The impact of utility is such, that an increase or decrease in the same, defines the price at which the consumer is willing to purchase the product.
This has a major impact on the demand for the product and is vital for its survival.
Monetary policy and its impact on socio-economic-politico scenario
The central bank sets up the monetary policy over a period of time, depending upon the conditions prevalent in the society.
This is done to control cases of inflation or recession as case may be. The Monetary policy includes components such as Statuary Liquidity Ratio and Cash Reserve Ratio. This decides the minimum balance that the banks need to maintain in order to be able to grant loans.
They help in deciding the rates at which banks can give loans to consumers. It widely impacts the social economic conditions prevalent in the society. Higher interest rates on loans mean that business needs cannot be adequately met or even if met have a higher costs.
These costs are ultimately passed on to the consumers which raises the prices and has an impact on savings. Savings then impact the circular flow of money and make it difficult for the government to have money to be able to conduct transactions.
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