Mid-Term
1. If you had to pick ONE measure to use in order to gauge the general standard of living
of the American people, what would it be? Why would you pick this one and not another?
What are some pros and cons of using this one measurement? (In crafting your answer,
please be detailed in your list of pros and cons, perhaps even comparing your selected
measure to some others.)
It is difficult to pick just one measure to gauge the general standard of living within the
United States since I believe using several of the measures together would provide the best and
most accurate rating of our standard of living. With that being said if I were to pick only one, I
would have to choose the GPI. I feel there are more advantages using the GPI than
disadvantages, unlike the GDP and other measures used in calculating the standard of living.
The GPI considers crime and divorce rates, household and volunteer work, national income
difference between the rich and poor, damages from air and water pollutions. It factors in social
and environmental factors into its calculations. GDP doesn’t consider any of those statistics
within its calculation. It does not measure unpaid work, distribution of wealth, changes in the
quality of life or goods. GDP accounts for the amount products being produced, but doesn’t even
consider the resources or the pollution being used for these products. If a company decides to
replace its employees with robotic machinery to increase production then the GDP will increase,
and not take any consideration on the unemployment numbers. GDP could also increase if crime
rates increase. If crime rates increase production of security measures like alarms, locks, and
police force increase as well, in turn increasing the GDP. Another measure used to gauge the
standard of living is the HDI, which considers the standard of living globally instead of
nationally. It does not; however, consider the inequality within gender in the nation. Therefore a
lot of middle-east countries could score higher even though gender inequality is extremely high.
One of the biggest disadvantages of using GDI is it is hard to calculate and measure quality of
life, personal values, and environment; which can be hard to assign value economically. With
that being the GPI still looks more at the whole picture when considering the standard of living
rates.
2. Provide an example of how inflation has (or may in the future) impacted your life. Why
might the increase in the overall price level of the good/service you picked have a different
impact on someone else’s standard of living than it does yours? BE SPECIFIC!
The increase in the cost of common household items have been greatly impacted by
inflation. I know that it has impacted my family’s household standard of living, due to budgeting
more of our finances towards food, hygienic products, cleaners, and clothes. The cost of food
has been continuously increasing throughout the last several years, and I believe it will continue
to increase in the years to come. Currently I spend at least $500 a month on food alone for a
family of six, and within the next few years or so, I believe this price will continue to increase.
My family already struggles to ensure we have enough food to go around, and the increase of
prices do not help matters. My husband and I are now paying $3.15 for a gallon of milk and
$1.98 for a loaf of bread which is $.70 cents more from when we first got married in 2005. I
know it seems like $.70 cents is not a lot, but when added up we are paying on average $252
more a year just for milk and bread than we were in 2005. Granted we make more money than
we did in 2005, but the increase in our monthly finances has not been able to keep up with the
increase in inflation. We are a middle class family that live pay check to pay check, but are still
able to manage through and pay our monthly bills and still afford the occasional date night. My
thoughts go more towards the families that are unable to have that dollar stretch to the next pay
check. How are they able to afford to feed their families, and this is only going to get worst as
inflation will always continue to increase. The government does have programs like WIC and
food stamps, but these system get mistreated and abused by citizens. If inflation continues to
increase then our taxes will increase to cover the cost difference for food stamps and WIC. I feel
that it is an unfair never ending cycle that somehow needs to be changed for the better, and
changed soon.
3. Technology plays an important role in the 21st century economy, especially regarding
computing power, trade and communications. In your opinion, how might the continual
improvement in technology affect the nation’s unemployment situation? Also, how might
increased productivity from technological advances impact wages? (Keep in mind that
there may likely be benefits and drawbacks to advances in technology with regard to global
job markets.)
Technology is the leading contributor to the growth of productivity. Per the Nineteenth
edition text book by McGraw-Hill the technological advance account for 40% of the productivity
growth. The technology advancement contributes to the advancement for businesses globally,
which improves managerial methods, business organization, entrepreneurs, process of
production, and even medicine. The increase of technology changes the structure of the demand
for jobs. As technology increases then the need for employees that are technologically
