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DO BUDGET CUTS HURT YOUNG MORE THAN ELDERS?????

DO BUDGET CUTS HURT YOUNG MORE THAN ELDERS


Definition:

A budget is a financial document used to project future income and expenses. The budgeting process may be carried out by individuals or by companies to estimate whether the person/company can continue to operate with its projected income and expenses.

A budget may be prepared simply using paper and pencil, or on computer using a spreadsheet program like Excel, or with a financial application like Quicken or QuickBooks.

The process for preparing a monthly budget includes:

•Listing of all sources of monthly income

•Listing of all required, fixed expenses, like rent/mortgage, utilities, phone

•Listing of other possible and variable expenses.

DISCUSSION:

Budget affect mostly on new generation rather than elders.
Budget cuts could affect early education programs
"Without this program, a lot of people would not be able to make their money to support their families. Without being able to support their family and have employment, then you are stuck on welfare and other programs. We are all trying to stay off those programs," said Melissa Strom, a concerned parent.
In order to control the deficit demand the government interference is must. Due to decrease in demand of product, the investor will invest less amount, employer will not give employment to all person. Both above point are encourage only when the government would spend huge amount of expenditure. Government budget deficit grow directly or indirectly during recession. Directly the govt. would provide subsidies for setting up industries and all the input which is necessary to produce the output at low cost. Indirectly the govt. would encourage the public to invest or increase their consumption by providing good qualities product at reasonable rate. In this way the people will invest more to buy the product at reasonable price. To fulfill the increase in demand the producer will need more workers. Thus the person which are unemployed during recession will get the work. The whole procedure is possiable only with the help of govt. expenditure.
Less Spent on Employee Benefits
Many school districts pay for at least part of their teachers benefits. The amount that the school districts are able to pay typically suffers under budget cuts. This, in effect, is like a pay cut for teachers.

Less to Spend on Materials
One of the first things to go with budget cuts is the already small discretionary fund that teachers get at the beginning of the year. In many schools this fund is almost entirely used to pay for photocopies and paper throughout the year. Other ways that teachers might spend this money is on classroom manipulatives, posters, and other learning tools. However, as budget cuts increase more and more of this is either provided by the by the teachers and their students.

Less School-Wide Material and Technology Purchases
With less money, schools often cut their school-wide technology and material budgets. Teachers and media specialists who have researched and asked for specific products or items will find that these will not be available for their use. While this might not seem to be as big an issues as some of the other items on this list, it is just one more symptom of a wider problem. The individuals who suffer most from this are the students who are not able to benefit from the purchase.

Delays for New Textbooks
Many teachers only have outdated textbooks to give their students. It's not unusual for a teacher to have a social studies textbook that is 10-15 years old. In American History, this would mean that two to three presidents have not even been mentioned in the text. Geography teachers often complain about having textbooks that are so outdated that they aren't even worth giving to their students. Budget cuts just compound this problem. Textbooks are very expensive so schools facing major cuts will often hold off on getting new texts or replacing lost texts.

Less Professional Development Opportunities
While this might not seem like a big deal to some, the truth is that teaching just like any profession, becomes stagnant without continual self improvement. The field of education is changing and new theories and teaching methods can make all the difference in the world for new, struggling, and even experienced teachers. However, with budget cuts these activities are typically some of the first to go.

Less Electives
Schools facing budget cuts typically begin by cutting their electives and either moving teachers to core subjects or eliminating their positions entirely. Students are given less choice and teachers are either moved around or stuck teaching subjects they are not ready to teach.

Larger Classes
With budget cuts come larger classes. Research has shown that students learn better in smaller classes. When there is overcrowding there is a greater likelihood of disruptions. Further, it is much easier for students to fall through the cracks in larger schools and not get the extra help they need and deserve to succeed. Another casualty of larger classes is that teachers are unable to do as many cooperative learning and other more complex activities. They are just too difficult to manage with very large groups.

• Budget cut for education => Increase density of education...
Budget cut of education => Decrease density of education...
How much will the budget cuts affect your studies?
In recent months, universities have been thrown into turmoil with news of spending cuts and that student fees will rise up to £9,000 a year from 2012. But what will this mean for postgraduates? How easy will it be for tomorrow's graduates to fund a Masters course? Will scholarships for PhD students dry up? Will the same wide range of postgraduate courses be available? And what will any changes at this level mean to the future of our universities, our professions and the economy at large?
This is a wise thing to do, according to recent research published by the British Library and the Higher Education Policy Institute, showing that three and a half years after graduation, 94 per cent of postgraduates find work in the professions, compared to 78 per cent of undergraduates.
Professor Steve West, the vice chancellor of the University of the West of England, says future students "are likely to be very focused on what will give them the skill sets they are looking for. They will be seeking out vocational professional programmes, not an MA in history." However, key vocational funding streams are in doubt, he points out. No one knows how teacher training will be supported in the future, "and I don't see how local health authorities will be able to carry on funding their training budgets in the same way."
Professor West says: "Universities are certainly going to be looking at their portfolios. At the end of the day it will be a question of what the market is prepared to pay for."
"The evidence suggests that PhD students thrive in research-intensive environments and that backing institutions with a critical mass of research activity benefits the graduate students, as well as being the most productive way to fund research."
All commentators agree that blended and distance learning courses are increasingly likely to figure in the postgraduate landscape, and that rising student debts and plunging government support could make the postgraduate sector increasingly the preserve of the wealthy – especially as the postgraduate student population tends to reflect the make-up of the undergraduate one.
Paul Wakely, an education studies lecturer at the University of York, who has studied access to postgraduate courses, says: "It's really anyone's guess what the new levels of student debt will mean.
"Studies have shown that debt per se has not seemed to be a deterrent to study. The postgraduate sector is much more varied than the undergraduate one, so no one knows what the future will bring."
Budget cuts will affect every student, need serious dialogue about raising revenue
CEA President Beverly Ingle, commenting to the press today, said the coming K-12 budget cuts will be very painful and very unpopular. “Our students and schools suffered a $260 million cut last year and now we are looking at another $375 million? School will begin next August with at least $500 less in resources for every child.”
Ingle was reflecting the concerns of CEA members across the state who learned today of Gov. Hickenlooper’s 2011-12 budget proposal. She acknowledged that no state program is immune from the impact of a billion-dollar deficit and each school district will decide what to do about the state cuts coming its way.
“We know this is an impossible situation. That said, it’s time to start talking very seriously about a long-term solution to our state’s revenue crisis. Bleeding money from schools is not a sustainable solution.”
CEA members are up for this dialogue, Ingle added, and are interested in working collaboratively with others who care about the future of Colorado — to find a way to raise revenue for the things citizens care about, not just public education but all the essential public services important to the people who live in this state.
CEA members are worried, however, about what the extreme budget cuts will mean across 178 school districts. Many educators are already engaged in conversation and study with their school boards and administration about what the cuts will mean and how to handle them in the coming year, especially given that the state aid cut is anticipated to be so much larger for 2011-12. The possibilities are not pretty. Furlough days, salary freezes, benefit freezes or changes, shorter weeks, program changes or program eliminations, large class sizes, employee lay-offs.

CONCLUSION

In India 60 percent population lays between 20 to 30 years. There are the young generation of India and budget is affected to the youth more than elders among their fashions,nature,expenses….
Mainly budget contains:
1.Taxes,Subsidies..
2.Investment in various industries,increasing production,providing unemployment to youth..
All these terms are involved in budget….


Submitted To: Prof. Gurdeepak Singh
Submitted By: Gagandeep Gupta
MBA-1(C)

price elasticity of demand for gasoline

A rise in gas taxes won't do anything to change people's behavior. Are people going to stop driving to work if prices go up? Are they going to quit their jobs? Are they going to sell their house and move closer to work? Of course not! Higher gas prices do nothing but give the government more of our hard earned dollars. Of course, one could illustrate all the ways that someone could cut back on fuel consumption in response to higher prices, such as carpooling, going to the supermarket and the post office in one trip instead of two, and so on. What we're really debating is - what is the price elasticity of demand for gasoline? Is it zero? That is, if gasoline rises 10%, what happens to the quantity demanded for gasoline? We do not have to just theorize about how people may respond to a rise in gas hikes, we can look at studies which determine what the price elasticity of demand for gasoline is.
It turns out that there are a lot of studies which calculate what the price elasticity of demand is. There seems to be at least 100. Fortunately there are two good meta-analyses which examine the work of many different studies on the matter.
One such study is Explaining the variation in elasticity estimates of gasoline demand in the United States: A meta-analysis by Molly Espey, published in Energy Journal. Espey examined 101 different studies and found that in the short-run (defined as 1 year or less), the average price-elasticity of demand for gasoline is -0.26. That is, a 10% hike in the price of gasoline lowers quantity demanded by 2.6%. In the long-run (defined as longer than 1 year), the price elasticity of demand is -0.58; a 10% hike in gasoline causes quantity demanded to decline by 5.8% in the long run.
Another terrific meta-analysis was conducted by Phil Goodwin, Joyce Dargay and Mark Hanly and given the title Review of Income and Price Elasticities in the Demand for Road Traffic. A PDF file of the study is available here. If you're interested in the subject, it's an absolute must-read. They summarize their findings on the price-elasticity of demand of gasoline as follows:
If the real price of fuel goes, and stays, up by 10%, the result is a dynamic process of adjustment such that:
a) The volume of traffic will go down by roundly 1% within about a year, building up to a reduction of about 3% in the longer run (about five years or so).
b) The volume of fuel consumed will go down by about 2.5% within a year, building up to a reduction of over 6% in the longer run.
The reason why fuel consumed goes down by more than the volume of traffic, is probably because price increases trigger more efficient use of fuel (by a combination of technical improvements to vehicles, more fuel conserving driving styles, and driving in easier traffic conditions). So further consequences of the same price increase are:
c) Efficiency of use of fuel goes up by about 1.5% within a year, and around 4% in the longer run.
d) The total number of vehicles owned goes down by less than 1% in the short run, and 2.5% in the longer run. It's important to note that the realized elasticities depend on factors such as the timeframe and locations that the study covers - the realized drop in quantity demanded in the short run from a 10% rise in fuel costs may be greater or lower than 2.5%. Goodwin et. al. find that in the short-run the price elasticity of demand is -0.25, with a standard deviation of 0.15, while the long rise price elasticity of -0.64 has a standard deviation of -0.44.
While we cannot say with absolutely certainty what the magnitude a rise in gas taxes will have on quantity demanded, we can be reasonbly assured that a rise in gas taxes, all else being equal, will cause consumption to decrease.

FINANCIAL CRISIS AND HOUSING BUBBLE

             The term financial crisis is applied broadly to a variety of situations in which some financial institutions or assets suddenly lose a large part of their value. In the 19th and early 20th centuries, many financial crises were associated with banking panics, and many recessions coincided with these panics. Other situations that are often called financial crises include stock market crashes and the bursting of other financial bubbles, currency crises, and sovereign defaults. Financial crises directly result in a loss of paper wealth; they do not directly result in changes in the real economy unless a recession or depression follows.

           Many economists have offered theories about how financial crises develop and how they could be prevented. There is little consensus, however, and financial crises are still a regular occurrence around the world.

TYPES OF FINANCIAL CRISIS

1. BANKING CRISIS

When a bank suffers a sudden rush of withdrawals by depositors, this is called a bank run. Since banks lend out most of the cash they receive in deposits (see fractional-reserve banking), it is difficult for them to quickly pay back all deposits if these are suddenly demanded, so a run may leave the bank in bankruptcy, causing many depositors to lose their savings unless they are covered by deposit insurance. A situation in which bank runs are widespread is called a systemic banking crisis or just a banking panic. A situation without widespread bank runs, but in which banks are reluctant to lend, because they worry that they have insufficient funds available, is often called a credit crunch. In this way, the banks become an accelerator of a financial crisis.

Examples of bank runs include the run on the Bank of the United States in 1931 and the run on Northern Rock in 2007. The collapse of Bear Stearns in 2008 has also sometimes been called a bank run, even though Bear Stearns was an investment bank rather than a commercial bank. The U.S. savings and loan crisis of the 1980s led to a credit crunch which is seen as a major factor in the U.S. recession of 1990–91.

2. SPECULATIVE BUBBLE AND CRASHES

Economists say that a financial asset (stock, for example) exhibits a bubble when its price exceeds the present value of the future income (such as interest or dividends) that would be received by owning it to maturity. If most market participants buy the asset primarily in hopes of selling it later at a higher price, instead of buying it for the income it will generate, this could be evidence that a bubble is present. If there is a bubble, there is also a risk of a crash in asset prices: market participants will go on buying only as long as they expect others to buy, and when many decide to sell the price will fall. However, it is difficult to tell in practice whether an asset's price actually equals its fundamental value, so it is hard to detect bubbles reliably. Some economists insist that bubbles never or almost never occur.

Well-known examples of bubbles (or purported bubbles) and crashes in stock prices and other asset prices include the Dutch tulip mania, the Wall Street Crash of 1929, the Japanese property bubble of the 1980s, the crash of the dot-com bubble in 2000–2001, and the now-deflating United States housing bubble.

3. INTERNATIONAL FINANCIAL CRISIS

When a country that maintains a fixed exchange rate is suddenly forced to devalue its currency because of a speculative attack, this is called a currency crisis or balance of payments crisis. When a country fails to pay back its sovereign debt, this is called a sovereign default. While devaluation and default could both be voluntary decisions of the government, they are often perceived to be the involuntary results of a change in investor sentiment that leads to a sudden stop in capital inflows or a sudden increase in capital flight.

Several currencies that formed part of the European Exchange Rate Mechanism suffered crises in 1992–93 and were forced to devalue or withdraw from the mechanism. Another round of currency crises took place in Asia in 1997–98. Many Latin American countries defaulted on their debt in the early 1980s. The 1998 Russian financial crisis resulted in a devaluation of the ruble and default on Russian government bonds.

 4. WIDER ECONOMIC CRISIS

Negative GDP growth lasting two or more quarters is called a recession. An especially prolonged recession may be called a depression, while a long period of slow but not necessarily negative growth is sometimes called economic stagnation. Since these phenomena affect much more than the financial system they are not usually considered financial crises as such though there are clearly links between the two.

Some economists argue that many recessions have been caused in large part by financial crises. One important example is the Great Depression, which was preceded in many countries by bank runs and stock market crashes. The subprime mortgage crisis and the bursting of other real estate bubbles around the world also led to recession in the U.S. and a number of other countries in late 2008 and 2009.

Some economists argue that financial crises are caused by recessions instead of the other way around, and that even where a financial crisis is the initial shock that sets off a recession, other factors may be more important in prolonging the recession. In particular, Milton Friedman and Anna Schwartz argued that the initial economic decline associated with the crash of 1929 and the bank panics of the 1930s would not have turned into a prolonged depression if it had not been reinforced by monetary policy mistakes on the part of the Federal Reserve,^[8] a position supported by Ben Bernanke

HOUSING BUBBLE (TYPE OF SPECULATIVE BUBBLE)

          A real estate bubble or property bubble (or housing bubble for residential markets) is a type of economic bubble that occurs periodically in local or global real estate markets. It is characterized by rapid increases in valuations of real property such as housing until they reach unsustainable levels and then decline

                                                         OR

         Temporary condition caused by unjustified speculation in the housing market that leads to a rapid increase in real estate prices. As with most economic bubbles, it eventually bursts, resulting in a quick decline in prices. The end of a housing bubble is hard to predict given the fact that economic conditions can change without warning. If a housing bubble swells to an extremely high level, the aftermath of a burst may set the housing market back years.

MACROECONOMIC SIGNIFICANCE

Within mainstream economics, economic bubbles, and in particular real estate bubbles, are not a considered major concerns. Within some schools of heterodox economics, by contrast, real estate bubbles are considered of critical importance and a fundamental cause of financial crises and ensuing economic crises.
The mainstream economic view is that economic bubbles bring about a temporary boost in wealth and a redistribution of wealth. When prices increase, there is a positive wealth effect (property owners feel richer and spend more), and when they decline, there is a negative wealth effect (property owners feel poorer and spend less). These effects, it is argued, can be smoothed by counter-cyclical monetary and fiscal policies. The ultimate effect on owners who bought before the bubble formed and did not sell is zero. Those who bought when low and sold high profited, while those who bought high and sold low (after the bubble has burst) or held until the price fell lost money. This redistribution of wealth, it is also argued, is of little macroeconomic significance.

HOUSING MARKET INDICATORS

In attempting to identify bubbles before they burst, economists have developed a number of financial ratios and economic indicators that can be used to evaluate whether homes in a given area are fairly valued. By comparing current levels to previous levels that have proven unsustainable in the past (i.e. led to or at least accompanied crashes), one can make an educated guess as to whether a given real estate market is experiencing a bubble. Indicators describe two interwoven aspects of housing bubble: a valuation component and a debt (or leverage) component. The valuation component measures how expensive houses are relative to what most people can afford, and the debt component measures how indebted households become in buying them for home or profit (and also how much exposure the banks accumulate by lending for them). A basic summary of the progress of housing indicators for U.S. cities is provided by Business Week. See also: real estate economics and real estate trends.

 HOUSING AFFORDIBILITY MEASURES

·         The price to income ratio is the basic affordability measure for housing in a given area. It is generally the ratio of median house prices to median familial disposable incomes, expressed as a percentage or as years of income. It is sometimes compiled separately for first time buyers and termed attainability. This ratio, applied to individuals, is a basic component of mortgage lending decisions. According to a back-of-the-envelope calculation by Goldman Sachs, a comparison of median home prices to median household income suggests that U.S. housing in 2005 is overvalued by 10%. "However, this estimate is based on an average mortgage rate of about 6%, and we expect rates to rise," the firm's economics team wrote in a recent report.^[14] According to Goldman's figures, a one-percentage-point rise in mortgage rates would reduce the fair value of home prices by 8%.

·         The deposit to income ratio is the minimum required down payment for a typical mortgage, expressed in months or years of income. It is especially important for first-time buyers without existing home equity; if the down payment becomes too high then those buyers may find themselves "priced out" of the market. For example, as of 2004^[update] this ratio was equal to one year of income in the UK.
      Another variant is what the United States’ National Association of Realtors calls the "housing affordability index" in its publications.^[16] (The NAR's methodology was criticized by some analysts as it does not account for inflation.^[17] Other analysts, however, consider the measure appropriate, because both the income and housing cost data is expressed in terms that include inflation and, all things being equal, the index implicitly includes inflation. In either case, the usefulness of this ratio in identifying a bubble is debatable; while down payments normally increase with house valuations, bank lending becomes increasingly lax during a bubble and mortgages are offered to borrowers who would not normally qualify for them .

·         The Affordability Index measures the ratio of the actual monthly cost of the mortgage to take-home income. It is used more in the United Kingdom where nearly all mortgages are variable and pegged to bank lending rates. It offers a much more realistic measure of the ability of households to afford housing than the crude price to income ratio. However it is more difficult to calculate, and hence the price to income ratio is still more commonly used by pundits. In recent years, lending practices have relaxed, allowing greater multiples of income to be borrowed. Some speculate that this practice in the long-term cannot be sustained and may ultimately lead to unaffordable mortgage payments, and repossession for many.

·         The Median Multiple measures the ratio of the median house price to the median annual household income. This measure has historically hovered around a value of 3.0 or less, but in recent years has risen dramatically, especially in markets with severe public policy constraints on land and development. The Demographia International Housing Affordability Survey uses the Median Multiple in its 6-nation report.

 

HOUSING DEBT MEASURES

·         The housing debt to income ratio or debt-service ratio is the ratio of mortgage payments to disposable income. When the ratio gets too high, households become increasingly dependent on rising property values to service their debt. A variant of this indicator measures total home ownership costs, including mortgage payments, utilities and property taxes, as a percentage of a typical household's monthly pre-tax income; for example see RBC Economics' reports for the Canadian markets.

·         The housing debt to equity ratio (not to be confused with the corporate debt to equity ratio), also called loan to value, is the ratio of the mortgage debt to the value of the underlying property; it measures financial leverage. This ratio increases when the homeowner takes a second mortgage or home equity loan using the accumulated equity as collateral. A ratio greater higher than 1 implies that owner's equity is negative.

HOUSING OWNERSHIP AND RENT MEASURES

·         The ownership ratio is the proportion of households who own their homes as opposed to renting. It tends to rise steadily with incomes. Also, governments often enact measures such as tax cuts or subsidized financing to encourage and facilitate home ownership. If a rise in ownership is not supported by a rise in incomes, it can mean either those buyers are taking advantage of low interest rates (which must eventually rise again as the economy heats up) or that home loans are awarded more liberally, to borrowers with poor credit. Therefore a high ownership ratio combined with an increased rate of subprime lending may signal higher debt levels associated with bubbles.

·         The price-to-earnings ratio or P/E ratio is the common metric used to assess the relative valuation of equities. To compute the P/E ratio for the case of a rented house, divide the price of the house by its potential earnings or net income, which is the market annual rent of the house minus expenses, which include maintenance and property taxes. This formula is:

The house price-to-earnings ratio provides a direct comparison to P/E ratios used to analyze other uses of the money tied up in a home. Compare this ratio to the simpler but less accurate price-rent ratio below.

·            The price-rent ratio is the average cost of ownership divided by the received rent income (if   buying to let) or the estimated rent that would be paid if renting (if buying to reside):

The latter is often measured using the "owner's equivalent rent" numbers published by the Bureau of Labor Statistics. It can be viewed as the real estate equivalent of stocks' price-earnings ratio; in other terms it measures how much the buyer is paying for each dollar of received rent income (or dollar saved from rent spending). Rents, just like corporate and personal incomes, are generally tied very closely to supply and demand fundamentals; one rarely sees an unsustainable "rent bubble" (or "income bubble" for that matter). Therefore a rapid increase of home prices combined with a flat renting market can signal the onset of a bubble. The U.S. price-rent ratio was 18% higher than its long-run average as of October 2004.^[19]

·         The gross rental yield, a measure used in the United Kingdom, is the total yearly gross rent  divided by the house price and expressed as a percentage:

This is the reciprocal of the house price-rent ratio. The net rental yield deducts the landlord's expenses (and sometimes estimated rental voids) from the gross rent before doing the above calculation; this is the reciprocal of the house P/E ratio.

Because rents are received throughout the year rather than at its end, both the gross and net rental yields calculated by the above are somewhat less than the true rental yields obtained when taking into account the monthly nature of rental payments.

• The occupancy rate (opposite: vacancy rate) is essentially the number of occupied units divided by the total number of units in a given region (in commercial real estate, it is usually expressed in terms of area such as square meters for different grades of buildings). A low occupancy rate means that the market is in a state of oversupply brought about by speculative construction and purchase. In this context, supply-and-demand numbers can be misleading: sales demand exceeds supply, but rent demand does not.

WARNING SIGNS RELATED TO HOUSING BUBBLE:

Most people only recognize housing bubbles in hindsight, after the crash has occurred. To help people weather potential storms better, economists have started using certain indicators to try and identify bubbles in specific geographic areas. They begin by comparing current prices to the prices seen during previous boom cycles. This comparison gives them an idea of whether current housing prices are inflated.

Economists then look at other indicators that fall into two broad categories: valuation (cost of homes vs. what most people can afford) and debt (how much debt homeowners are carrying).

On the valuation side, economists evaluate the price to income ratio and deposit to income ratio to determine the percentage of income people need to pay for a house and its down payment. On the debt side, they examine the debt to income ratio or the total cost of home ownership relative to a family's income.

There are other factors involved in economists' assessments, but these main indicators can give them a pretty good idea of whether or not a bubble is forming.

Assignment-1

Accounting

For

Management

Submitted to:-

Mr.gurdeepak singh

submitted by:-

Shikha

Roll no.- 44

Mba-1 ‘c’

INTRODUCTION OF MASS POVERTY & UNEMPLOYMENT

Mass poverty:-

Mass poverty when inflation has increases day by day i.e rising prices, corruption etc. It is associated with a minimum level of living & minimum consumption requirement of basic needs such as clean water, heath care education, clothing, housing, food etc.

Unemployment:-

Unemployment describes the state of a worker who is able to work and willing to work, fail to secure work or activity which gives them income or livelihood. A high unemployment rate generally shows an economy in recession with few job opportunities.

HIGHER GROWTH REMOVES MASS POVERTY

• · Illiteracy should be removed
• · Unemployment should be removed
• · Per capita should be increased
• · Capital formation should be increased
• · Population should be controlled
• · Increase Industrialization
• · Investment should be increased
• · Inflation should be removed
• · Economics growth should be increased

HIGHER GROWTH REMOVES UNEMPLOYMENT

• · Growth will be increased
• · Improves saving and investment
• · Income should be increased
• · Enhances development
• · Production should be increased
• · Unemployment should be removed
• · To remove the corruption

CONCLUSION

“States will not allow the concentrations of wealth and means production in the hand of few persons.”

But production in the hand of few persons then poverty and unemployment has increase day by day. If saving, investment and income should be increased then poverty and unemployment will be removed.