Nowadays, America is one of the countries in the world that have had economic prosperity for a number of years, attributed to good management and exploitation of natural resources for efficient production of goods and services. American economy is market oriented, which means that consumers determine the forces of the economy that is technologically powerful as well. The country majorly produces computers, machinery, aerospace, military and agricultural equipment.
American natural vast land has enabled economies of scale in both administration and firms. Thus, the cost of production was lowered. Agriculture has been a major aspect of the American economy through production and exports. Millions of its citizens got jobs and this led to the country’s growth and prosperity. Moreover, it brought back a trade surplus of more than 135 billion dollars annually. The industry is also able to produce enough food for the American citizens and for export; this created a positive balance of trade.
In the United States, private companies take on most of the production of gods and services through a various techniques such as specialization. Thus, different firms will produce different kinds of products. Some time ago, American families were dependent on themselves, mostly producing their own goods and services. Nowadays, in conditions of growing population, consumers find it easier to purchase commodities instead. Therefore, people and firms started to specialize and divide the labor producing one particular type of good or service instead of producing a variety of products. Most businesses practice division of labor, where different tasks are assigned to different people in the work place.
Through these techniques, workers become the experts in their fields, and this efficiency lowers the cost of production and enables the development of tools and machines that assist the workers in carrying out their tasks. Specialization has led to creation of numerous production facilities in the country and has enabled expansion to the international markets. Thus, the techniques mentioned are indeed essential to the economy as they ensure efficient production of goods and services.
After World War II, the United States had experienced rapid economic growth that resulted in greater incomes for its citizens that began to spend their money on leisure activities. With time, the level of American service industry has increased, giving rise to economic prosperity driven by strong market forces, technology, competition and international trade.
Business firms in the United States are more flexible as compared to China in terms of expansion of capital plant decisions, development of new products and decisions of retrenching excess workers. All this has contributed to the efficiency in production and maintenance of large markets worldwide. China is also one of the top producers in the world that specializes in production of numerous types of goods and services ranging from automobiles, machinery, energy, agriculture and many others. Chinese economy has been maintained by its mass exports to different countries and has continued to rise gradually over the years. China's economic growth has also been attributed to the policies of entry into its local markets by various countries. A number of countries take their production to China as the country has been providing a cheap labor for a number of years. Nowadays, its cost of labor has been gradually increasing. However, the United States faces more barriers with regard to entry into the home markets, especially with rival economies
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