The Effects of Bunny Rabbits in the UK on Performance Indicators - Paper Example

Bunny rabbits are small furry animals that have large acute floppy years. Bunny rabbit has an impact on economic performance of a country such as the UK. It simply means an increase in the number of rabbits in the country. These rabbits destroy crops, businesses and UK infrastructure. Its effect is felt in different macroeconomic indicators such as price and inflation, employment and unemployment, GDP and economic growth and balance of payment.

Price and Inflation

Price is the value of a product while inflation is an aggregate increase in commodity price in a country. Inflation is, therefore, a measure that shows the loss of purchasing power of money of a given country (Dwivedi, 2001). When the value of money has gone down, the citizen uses large sums of money to buy fewer goods and this reduces the living standard of the people. Because bunny rabbits damage crops and businesses, the production capacity of agricultural and industrial commodities reduces thus increasing demand for goods and services. The increase in demand for goods and services causes an increase in the price of these commodities.

Employment and Unemployment

Employment is the increase in job opportunities in the country while unemployment is the decrease in the number of jobs available for the citizens. The introduction of bunny rabbits in the UK by Romans cost the economy of UK more than 260m annually. They destroy crops, businesses, and infrastructure which are important for the growth and expansion of different businesses. Since bunny rabbits destroy crops it discourages farmers from farming and doing other businesses which provide job opportunities for the people of UK.

GDP and economic growth

GDP is a very important economic indicator used in measuring the economic health of a country. It is a total value of goods and services that a country produces in one financial year. Bunny rabbits in the UK reduce its GDP and economic growth because it reduces the production capacity of UK. The increase in the number of rabbits increases the destruction of crops and trees in the country thus reducing the number of agricultural crops that UK produce in one financial year. GDP, therefore, has to reduce significantly because it reduces production in the agricultural sector of the economy.

Balance of payment

The balance of payment is financial statement where a country records its business transactions with other countries. The transactions include payment and receipts of each country which is usually required to be equal (Smith and Charles, 2009). With the increase in Bunny rabbits in the UK, the production of agricultural commodities reduces. UK will, therefore, export less agricultural commodities to other countries such as Japan and US in exchange for automobiles and dollars. Because of this, there will be an apparent inequality because the US will receive less agricultural products in exchange for their dollars.

The increase in the number of bunny rabbits in the UK will also reduce GDP, create a high level of unemployment and increase inflation because the production capacity of agricultural commodities will reduce. Reduction in production will also cause unemployment and inflation due to an increase in demand for agricultural commodities. The situation will be worse than it is today. The damage that these rabbits will have on crops will be much more extensive than now and therefore control measures should be taken to reduce their number.

Bunny rabbit is not a policy measure but a factor in the UK that affect its economy. Responses to policies such as monetary and fiscal policy will have a positive effect on the problems caused by it (Larch and Martins, 2009). These policies will reduce inflation by either reducing the amount of money in circulation or imposing more tax on certain commodities to reduce their importations. This helps it to create a balance of payment and also increase the production of the country. This will encourage domestic companies to produce more to meet the demand of the people.

References

Larch, M. and J. Nogueira Martins (2009). Fiscal Policy Making in the European Union: An Assessment of Current Practice and Challenges. Routledge.

Dwivedi, D.N. (2001). Macroeconomics: theory and policy. New Delhi: Tata McGraw-Hill. ISBN 978-0-07-058841-7.

Smith, Charles Emrys, "Economic Indicators", in Wankel, C. (ed.) Encyclopedia of Business in Today's World (2009). California, USA.