Development Economic Risks 1
Running Head: DEVELOPMENT RISKS
Development risks of high value
Development Economic Risks 2
1. Primary Economic Sectors
The primary risks of USA, the policies, and likely impact are given as follows (Sznewajs
and Moore, 2016; Obamacare Facts, 2016)
Risk Policies Likely Impact
Construction: Associated Builders and These rules will help to boost
After the subprime crisis, the Contractors polices to give construction of homes, offices,
construction industry has seen funding and help on and residential complexes.
a contraction by more than construction projects Built spaces will become
50%. Many small contractors, National Association of affordable with the fall in
builders, construction firms, Home Builders Loans prices of cement, steel, and
machinery and labor given to families for fuel. Since USA is developing
contractors have closed down. constructing homes. This its fuel sources, the
The economy is slowly will increase growth in dependence on expensive fuel
recovering and a 5 % growth construction. imports has reduced.
is seen. Portland Cement By providing affordable loans
Association requirements to deserving applicants that
The risk is that US and taxes relaxed for show their ability to repay
construction firms will cement manufacturers so loans, the government avoids
eventually die, and the nation that cement costs come a repeat of the subprime
will not have any engineering down and help in scandals.
firms. affordable construction.
Associated General
Contractors of America
rules relaxed for labor
contractors and they are
allowed to set reasonable
wages for workers.
Development Economic Risks 3
Risk Policies Likely Impact
Healthcare The government introduced The impact is that poor people
This is a major problem for Obamacare that promises get affordable care, and they
US citizens. With high health care plans for all. Even are assured of treatment. More
healthcare costs, many citizens poor people, below the than 10 million people are
are left out of the cover of poverty line, and those now enrolled in various health
primary and specialized care. excluded due to preexisting plans.
Healthcare insurance has conditions are now covered. Due to this large enrollment,
become expensive, and the costs of the Obamacare
millions of poor citizens increased to $7 trillion. Costs
cannot afford a good health of health insurance for
plan. working people has increased,
and placed a tremendous
burden on them.
2. Consumer Index Rates
Risks for Consumer Price Index are given as below (Trading Economics, 2016).
Risk Policies Likely Impact
Consumer Price Index – CPI The government has Too much regulation can
The CPI measures the average brought in policies such as make the firms
change for a defined period of setting the maximum retail unprofitable, and they may
prices for essential goods and price for food and close down.
services paid by consumers. beverages, and placed a Existing players can then
Some of the items measured limit on the interest place a premium on the
by CPI are food and charged for housing, prices, increasing the CPI.
beverages, housing, apparel, Department stores fight
transportation, medical care, with each other to offer
recreation, education and discounts.
communication, and other
goods and services such as
Development Economic Risks 4
Risk Policies Likely Impact
healthcare, funeral expenses,
personal expenses, etc. The
risk of CPI is that when the
value increases, it means that
people are paying more for
basic goods and services.
3. Inflation
Risks for inflation are given in the following table (Trading Economics, 2016).
Risk Policies Likely Impact
Inflation Government has Higher inflation reduces
The inflation rate is 1.1%. introduced policies to the buying power.
Higher inflation means that control deficit, prices of Excessive subsidies and
the buying power of citizens is fuel, food, homes, and tax cuts and increase the
reduced. energy burden on the government
4. Universities with programs
More than 1000 universities have programs on economics. Economics policies and risk
management are some of the subjects in the courses. These colleges are placed in different states.
Alabama has 18 universities, Alaska has three, California has more than 100 colleges, and so on
(Masters, 2016). It is not possible to give a break up of number of colleges in each state.
Development Economic Risks 5
References
Obamacare Facts, (2016). ObamaCare Facts: Facts on the Affordable Care Act. Retrieved 7
October 2016 from [Link]
Masters, 2016. Economics risk management colleges in USA. Retrieved 7 October 2016 from
[Link]
[Link]
Sznewajs, T. and Moore, B. A. 2016. Construction Industry Mega Trends Emerging from the
Recession: What Every CFM Needs to Know. Retrieved 7 October 2016 from
[Link]
Trading Economics, 2016. United States Consumer Price Index (CPI). Retrieved 7 October 2016
from [Link]