Financial Performance of the RCI and the BCE (Essay Sample)

Economic Analysis
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Abstract
Economics is a discipline that studies how people chose to distribute scarce resources. Its sole purpose is to investigate the processes that preside over the production, allocation and utilization of goods and services in an economy. Economics, as discipline is divided into two categories; macroeconomics and microeconomics. Microeconomics examines how businesses, correlate within a market to create a market. Macroeconomics investigates the economy as a complete to describe market behaviors as affected by external forces. A scrutiny of the economic situation in Australia, Cuba and Sweden will shed light on the ideal economic policy.
Introduction
In order to understand and analyze various economies as used by various countries, one ought to understand the various economies in use today. Economics is a social science whose sole goal is to investigate how people satisfy wants. In this case, it is aimed at finding out which is the best way of doing things in a country. It tends to analyze three countries way of doing business and also provide answers to prospective individuals who may wish to invest. It is important to understand the various world economies available before engaging in any analysis whatsoever. Below listed are some of World`s economies:
* Command economy. It is an economy where the government has full control on all the major particulars of the economy. It decides on what to produce, how to generate and allocate commodities in an economy. For example, in Cuba, the government has sponsored the mining industry, dictated the method of production and distribution in the economy.
* Welfare economy. It is a market economy that aims at ensuring fairness to all parties. For example, one may suggest construction of a petroleum distill company in a certain suburb, someone else basing his/ her argument on pollution may oppose that decision. Welfare economics comes into place and weighs the options to give the best to the community. Sweden is a perfect economy.
* Market economy. It is an economy where the prices of commodities are determined by the consumers and suppliers. It is a free market economy where demand & supply determine the market behavior. It is a perfect economy where scarcity, cost and marginal utility determine market behavior. A perfect example of a perfect economy is the economy in USA where price for commodities are driven by market forces.
* Traditional economy. It is a very inchoate economy that often relies on Agriculture as its source of revenue. Prices for commodities are dictated by the relevant authorities. A good example of this economy is the
Countries listed below use different economic policies. For instance, Australia uses the market economies, Cuba uses the command economies while Sweden uses the welfare economies. In this paper, several factors are to be considered in order to have a clear comparison of the market economies.
Statistics
The Below table provides data that helps of various economic systems as of the year 2013.
country

AUSTRALIA

SWEDEN

CUBA

Total population (as of year 2013)

23.1309 million

9.5926 million

11.2656 million

GDP/Capita (as of year 2013)

$ 67,468.07

$ 58,183.69

$ 6,051.22

Labor Force (as of year 2012)

12.0273 million

5.0824 million

5.3314 million

% of people working in Agriculture

3.6%

1.1%

19.7%

% of people working in industry

21.1%

43.9%

17.1%

% of people working in service

75%

46.1%

63.2%

% of people living below the poverty line

7.2%

8%

16.2%

Exports commodities

Metal & concentrates, coal, educational related travel services, natural gas, gold & crude petroleum

Wood & paper products, metal & concentrates, chemicals, machinery & transport equipment’s, petroleum products

petroleum, nickel, medical products, sugar, tobacco, fish

Exports in $

286,685.10 million

13230 million

210.86 million

Export partners by %

China 31.9%, Japan 15.5%, Republic of Korea 6.7%, United States 4.9%, India 3.6%

Norway 10.6%, Germany 10.2%, United Kingdom 7.4%, Denmark 7.3%, Finland 6.4%

China 30%, Spain 11%, brazil 5.1%, Belgium-Luxembourg 5.0%, Italy 3.2%

Import commodities

Personal travel services, crude oil, passenger motor vehicles, refined petroleum, freight transport services.

Machinery, crude petroleum & products, chemicals, motor vehicles, iron & steel, food stuffs , clothing

Refined petroleum, wheat, corn, poultry meat, concentrated milk

Imports in $

295,925.40 million

12670.00 million

557.66 million

Import partners by %

China 15%, United States 11.9%, Japan 6.5%, Singapore 5.4%, Thailand 4.2%,

Germany 18%, Denmark 8.9%, Norway 8.7%, Netherlands 6.1%, United Kingdom 5.5%

China 18%, Spain 16%,Brazil 9.4%, United States 7.6%, Mexico 5.5%

Discussion
In this part of the paper, the main goal is to provide answers to the following questions based on the information available.
1 What percentage of the population of each country is in the labor force?
* Australia
* Sweden:
* Cuba
2 What are the similarities and differences between the three countries in terms of the percentage of the population that works in each type of industry?
Similarities
* All the three countries have the largest proportion of people working in the service industry.
* In all three countries, the age bracket of the population in the labor force ranges from twenty to seventy fours year old.
* All the countries have created job markets for their civilians.
3 Why might the list of Australian exports be so much longer or shorter than that of the other countries? Provide Examples of exports for each country, and their percentage contribution to the economy
In the global market certain trends emerge, one may wonder why some countries have larger export commodities and less import commodities and vice versa. In such a case, the three models of economics (scarcity, opportunity cost and marginal utility). Some countries tend to export more, so as to meet the demand for a commodity. The opportunity cost is another reason. A country may tend to have a long list of exports or imports because of the situation in the country. For example, Australia could export more from China because of the friendly market.
Demand and supply can also lead to a long list of exports and perhaps a short list of imports and exports vice versa. In the context of demand and supply, a country may import commodities purposed at achieving a demand-supply equilibrium where price of commodities will equal quantity of commodity demanded. For example, Cuba has the highest importation rates on food stuff, therefore Cuba has a high demand for food stuffs.
Import-export trends could also emerge as a result of domestic costs and infrastructure availability. A country may prefer importing a commodity due to the cost involved in creating that commodity or perhaps to unavailability of infrastructure. For example, Sweden, is known for the production of heavy equipment for industries but it may prefer importing cars and cut on cost.
Another factor that affect import-exports trend is the foreign direct investment. An American company, may setup a food company in Cuba. Aimed at cutting the operational cost, the American company could also make the Cuban authorities reduce food exportation.
It is an obligation to maintain a trade balance, therefore, every country has to ensure importation and exportation of the good it produces. To avoid a trade deficit, a country has to maintain balance imports and exports. In this case, Sweden is seen to have a high import rate on machinery and at the same time a high exportation rate. It may seem strange but this is in accordance with the international statute that countries should maintain a trade balance to avoid any economic crisis.
The following are some percentage contribution of commodities to the economy. They are:

Australia

Sweden

Cuba

Commodities & its contribution to the economy

Iron ores & concentrates 21.82%, coal 12.50%, natural gas 4.6%, crude petroleum 2.83%

Machinery 35%, paper products 6%,
Vehicle, aircrafts & transport equipment 13.28%, mineral products 3.2%

Nickel 12%
Tobacco & substituents9.63%, chemicals and allied products 10.11%, base metals 5.3%

4 Why might some commodities appear on both a country's import and export list? Provide examples for each country to explain your answer.
It is amazing to see a country import and export a commodity. There may be high production cost or lack of infrastructure in a country that could make the country export a commodity for value addition. For example, records show that Cuba exports crude oil only to import refined oil for value addition.
Another possible reason for this behaviour, can result from the statute code and bylaws that have been put in place by the International trade organizations to control imports and exports. Gregory &Stuart (2013), argue that the policy requires that a certain percentage of what the country produces should be exported and also imported. It was put in place to reduce trade deficits and also cut on diseconomies of scale. It was also aimed at protecting developing countries from exploitation the developed countries.
5 Exports and imports total in the billions of dollars for each country. Explain what this tells you about our society.
Due to the increasing population in every c...