Relative Pronoun Use Quiz

Online Users Alter Their Identity Essay - 1585 Words

Online Users Alter Their Identity The online forum deals many prospects for individuals to discover their distinctiveness. In certain conditions, text centered communication forums permits users to show them in a way that cannot be probable in physical situations. There are two such online groups, whom work textually in genuine Multi User Dungeons (MUD’s) and Internet Relay Chat (IRC). MUDs are computer-generated truth, acting environments where user generates their own atmosphere by picking their names, gender and explanation of their physical looks. IRC deals user contact to hundreds of chat rooms on a huge variety of issues. Users are acknowledged by the names of their selection, unlike to the actual life names, in which user can perform to be, quite exactly, whoever they desire. Text centered communication forums deal users extraordinary liberties for the identity alteration by anonymity of online forums, which allows users to halt from social customs. Though, online users’ capability to alter thei r identity is also embarrassed by gender customs, comprising gender socialization variances in danger-captivating online. a. Analysis Turkle’s (1995) has acknowledged observation on MUD’s that how playing own part permits users to discover different features of their identity and capability to take on others personalities. It comprised chances to discover a broader variety of characters than those available in physical life, such as testing with drastically diverseShow MoreRelatedGoffmans Theory Of Dramaturgy1400 Words   |  6 Pagesconsciously or unconsciously used by Facebook’s users, which will all be applied in context of Facebook users. 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In 2012, there had been 49% where the data breach exposed people Social Security Number. The data breach of 2012 has a rate of 27.4% caused by hackers. These breaches were commonly from 36.4% businesses and 34.7% health and medical (Identity Theft ResourceRead MoreSocial Media And Its Effects On A Large Scale Essay1675 Words   |  7 Pagessenses of connection, which may lead to negative physical or psychological predicaments. Who is your primary audience or reader? Why? Be detailed in your answer about your audience. My primary audiences are employees responsible for the management of online content, and professionals in the field of Criminal Justice that have an interest in the risks of social networking. Parents of children and young people aged between eight and 17 years are incorporated as part of the audience. In general, I am targetingRead More Internet - How Real is Cyberspace? 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In order to conduct the research analysis there will be a Qualtrics survey given to 113 social media users in the Treasure Valley. The survey questions will be based on previous research that has shown demonstrating chances of a sexual predator committing a sexual

Ferguson Foundry Limited Free Essays

————————————————- Case: Ferguson Foundry Limited (FFL) EXECUTIVE SUMMARY Date: March 10 2013 To: Mark Ferguson, President From: Carl Holitzner Re: FFL’s Lower-Than-Budgeted Profit for the Fiscal Year Ended May 31 2010 The major issue is determining why Ferguson Foundry Limited’s (FFL) actual profit was $367,600 lower than budgeted, despite selling 2,000 more wood stoves (12,000 instead of 10,000 units). This will be explained using Variance Analysis to demonstrate the underlying reasons why the company failed to meet its president’s expectations. FFL profit for 2010 was below budget due to many factors both production and marketing related. We will write a custom essay sample on Ferguson Foundry Limited or any similar topic only for you Order Now From a production perspective, there were 3 major areas of concern all of which were unfavorable with respect to Variance Analysis (As shown in Exhibit 3): 1. Direct Labor 2. Variable Overhead 3. Fixed Cost The $139,200 unfavorable Direct Labor Variance can be attributed to many reasons however it is most likely linked to the management team. Due to the early retirement of the sales manager, the production manager being hospitalized and the accountant quitting, it can be understood that inefficiencies were bound to arise. Without proper management, labor reduced overall productivity of the company, as these workers took 121,200 hours to produce 12,00 stoves rather than the standard 120,000 hours that it should have taken. This reduced Net Income by $18,000 (Labor Yield Variance calculation). Secondly, the problem arising from Direct Labor also transcends to the Variable Overhead, as it is used as its cost driver. As a result, the $69,600 unfavorable Variable Overhead Variance can also be attributed to the more hours undertaken to produce the 12,000 stoves. With the lack of an inefficient management team, overhead could have accumulated through inefficient use and/or the budget could have not even accurately portrayed current rates for overhead items. The third problem with regards to the production perspective concerns the increase in fixed costs. In particular, the fixed manufacturing cost increased by $30,000 over budgeted costs, which in turn resulted in a reduction of net income by the same amount. This could have resulted due to several reasons such as additional machinery being required to handle the increased sales volume. However at this point it is unclear given the information provided and so further investigation must be conducted in an effort to better budget for future fixed costs. From a marketing perspective, there were also 3 major areas of concern all of which were unfavorable with respect to Variance Analysis: 1. Price 2. Fixed Cost 3. Sales Mix In analyzing the price changes, although it was beneficial to increase the sell price of the Basic Wood Stove ($300 to $325), this income benefit was significantly outweighed by the reduction in sell price of the Deluxe Wood Stove ($800 to $700). In the end, the price changes of both products resulted in a $300,000 reduction in profit (Sales Price Variance). Another reason for FFL’s lower than budgeted profit, although obvious and minor, had to do with the increase in selling and administration cost. As can be seen in Exhibit 3 by the Fixed Selling Administration Budget Variance, an increase in the fixed costs reduced net profit by $7,000. The third problem area, concerning the marketing perspective, involved the difference in sales mix from actual to budget. FFL actually sold more Basic Wood Stoves and fewer Deluxe Wood Stoves than budgeted. Unfortunately, the Deluxe Wood Stove possessed a higher standard contribution margin per unit than the Basic ($210 to $80). Therefore the difference in the mix of sales caused FFL’s net profit to be reduced by $234,000 (Sales Mix Variance). Ultimately, more market research must be conducted to better understand consumer wants and needs and thus be able to efficiently budget company products accordingly to reach profitability goals. APPENDIX EXHIBIT 1| | BASIC (Actual)| BASIC (Std. | DELUXE (Actual)| DELUXE (Std. )| Selling Price| $325| $300| $700| $800| Variable Costs:| Direct Materials| $67. 50| $70. 00| $171. 00| $190. 00| Direct Labor| $104. 00| $90. 00| $248. 00| $240. 00| Overhead| $52. 00| $45. 00| $124. 00| $120. 00| Sell Admin| $15. 00| $15. 00| $40. 00| $40. 00| Total Variable Costs| $238. 50| $220. 00| $583. 00| $590. 00| Contribution Margin| $86. 50| $80. 00| $117. 00| $210. 00| CO NTRIBUTION MARGINS TABLE| Illustration of some calculations involved: *Using the Actual Results Table Provided in Exhibit A Actual Unit Selling (Basic) = Sales Revenue ? Sales Volume (units) = $2,340,000 / 7,200 units = $325 Unit Direct Materials (Basic) = Direct Materials Cost ? Sales Volume (units) = $486,000 / 7,200 units = $67. 50 *Using the Unit Cost Standards Table Provided in Exhibit B Std. Unit Direct Labor (Basic) = DL Std. Qty. Per Unit x DL Std. Rate Per Hr. = 6 hrs. x $15. 00 per hr. = $90 APPENDIX EXHIBIT 2| For the Year Ended May 31 2010| | ACTUAL| FLEX-BUDGET VARIANCE| FLEX BUDGET| SALES-VOLUME VARIANCE| STATIC BUDGET| TOTAL VARIANCE| Quantity (units)| 12,000| | 12,000| | 10,000| | Sales Revenue| $5,700,000| ($300,000)| $6,000,000| $250,000| $5,750,000| ($50,000)| Variable Costs| $4,515,600| ($99,600)| $4,416,000| ($181,000)| $4,235,000| ($280,600)| CM| $1,184,400| ($399,600)| $1,584,000| $69,000| $1,515,000| ($330,600)| Fixed Costs| $919,500| ($37,000)| $882,500| | $882,500| ($37,000)| Net Income| $264,900| ($436,600)| $701,500| $69,000| $632,500| ($367,600)| FLEXIBLE BUDGET REPORT| GIVEN CALCULATED FILL IN THE BLANK VARIANCES: ($) = UNFAVORABLE $ = FAVORABLE Illustration of some calculations involved for Flex Budget: Flex Sales Revenue = Std. Sell Price Per Unit x Actual Sales volume (units) Basic Wood Stove = $300 x 7,200 units = $2,160,000 Deluxe Wood Stove = $800 x 4,800 units = $3,840,000 Total Flex Sales Revenue = $6,000,000 Flex Variable Costs = Std. Variable Price Per Unit x Actual Sales Volume (units) Basic Wood Stove = $220 x 7,200 = $1,548,000 Deluxe Wood Stove = $590 x 4,800 = $2,832,000 Total Flex Variable Costs = $4,416,000 Flex Fixed Costs = Static Fixed Costs APPENDIX EXHIBIT 3| | FLEX BUDGET VARIANCE| SALES VOLUME VARIANCE| SALES VARIANCES| | | | Sales Price| | $300,000 U| -| Sales Mix| | -| $234,000 U| Sales Quantity| | -| $303,000 F| Sales Volume | | -| $69,000 F| TOTAL SALES VARIANCE| | $300,000 U| $69,000 F| | | | | VARIABLE COST VARIANCES| | | | Direct Materials| | $109,000 F| -| Direct Labor| | $139,200 U| -| Overhead| | $69,600 U| -| Selling Admin| | $0| -| TOTAL VARIABLE COST VARIANCE| | $399,600 U| -| | | | | TOTAL CM VARIANCE| | $399,600 U| -| | | | | FIXED COST VARIANCES| | | | Mfg. Budget| | $30,000 U| -| Sell Admin Budget| | $7,000 U| -| TOTAL FIXED COST VARIANCE| | $37,000 U| -| | | | | TOTAL VARIANCE| | $436,600 U| $69,000 F| | | | | VARIANCES TABLE| U = Unfavorable F = Favorable APPENDIX Illustration of some calculations involved in creating Exhibit 3: SALES VARIANCE Section Sales Price Variance = Actual Units sold x (Actual Sell Price – Budgeted) Basic Wood Stove = 7,200 x ($325-$300) = $180,000 F Deluxe Wood Stove = 4,800 x ($700-$800) = $480,000 U Total Sales Price Variance = $300,000 U Sales Mix Variance = (Actual Sales Mix % – Budgeted) x Actual total units sold x Budgeted CM per unit Basic Wood Stove = [(7,200/12,000)-(4,500/10,000)] x 12,000 x $80 = $144,000 F Deluxe Wood Stove = [(4,800/12,000)-(5,500/10,000)] x 12,000 x $210 = $378,000 U Total Sales Mix Variance = $234,000 U Sales Quantity Variance = (Actual total units sold – Budgeted) x Budgeted Sales Mix % x Budgeted CM per unit Basic Wood Stove = (12,000-10,000) x (4,500/10,000) x $80 = $72,000 F Deluxe Wood Stove = (12,000=10,000) x (5,500/10,000) x $210 = $231,000 F Total Sales Quantity Variance = $303,000 F Sales Volume Variance = (Actual Sales Volume – Budgeted) x Budgeted Cm per unit Basic Wood Stove = (7,200-4,500) x $80 = $216,000 F Deluxe Wood Stove = (4,800-5,500) x $210 = $147,000 U Total Sales Volume Variance = $69,000 F How to cite Ferguson Foundry Limited, Essay examples Ferguson Foundry Limited Free Essays ————————————————- Case: Ferguson Foundry Limited (FFL) EXECUTIVE SUMMARY Date: March 10 2013 To: Mark Ferguson, President From: Carl Holitzner Re: FFL’s Lower-Than-Budgeted Profit for the Fiscal Year Ended May 31 2010 The major issue is determining why Ferguson Foundry Limited’s (FFL) actual profit was $367,600 lower than budgeted, despite selling 2,000 more wood stoves (12,000 instead of 10,000 units). This will be explained using Variance Analysis to demonstrate the underlying reasons why the company failed to meet its president’s expectations. FFL profit for 2010 was below budget due to many factors both production and marketing related. We will write a custom essay sample on Ferguson Foundry Limited or any similar topic only for you Order Now From a production perspective, there were 3 major areas of concern all of which were unfavorable with respect to Variance Analysis (As shown in Exhibit 3): 1. Direct Labor 2. Variable Overhead 3. Fixed Cost The $139,200 unfavorable Direct Labor Variance can be attributed to many reasons however it is most likely linked to the management team. Due to the early retirement of the sales manager, the production manager being hospitalized and the accountant quitting, it can be understood that inefficiencies were bound to arise. Without proper management, labor reduced overall productivity of the company, as these workers took 121,200 hours to produce 12,00 stoves rather than the standard 120,000 hours that it should have taken. This reduced Net Income by $18,000 (Labor Yield Variance calculation). Secondly, the problem arising from Direct Labor also transcends to the Variable Overhead, as it is used as its cost driver. As a result, the $69,600 unfavorable Variable Overhead Variance can also be attributed to the more hours undertaken to produce the 12,000 stoves. With the lack of an inefficient management team, overhead could have accumulated through inefficient use and/or the budget could have not even accurately portrayed current rates for overhead items. The third problem with regards to the production perspective concerns the increase in fixed costs. In particular, the fixed manufacturing cost increased by $30,000 over budgeted costs, which in turn resulted in a reduction of net income by the same amount. This could have resulted due to several reasons such as additional machinery being required to handle the increased sales volume. However at this point it is unclear given the information provided and so further investigation must be conducted in an effort to better budget for future fixed costs. From a marketing perspective, there were also 3 major areas of concern all of which were unfavorable with respect to Variance Analysis: 1. Price 2. Fixed Cost 3. Sales Mix In analyzing the price changes, although it was beneficial to increase the sell price of the Basic Wood Stove ($300 to $325), this income benefit was significantly outweighed by the reduction in sell price of the Deluxe Wood Stove ($800 to $700). In the end, the price changes of both products resulted in a $300,000 reduction in profit (Sales Price Variance). Another reason for FFL’s lower than budgeted profit, although obvious and minor, had to do with the increase in selling and administration cost. As can be seen in Exhibit 3 by the Fixed Selling Administration Budget Variance, an increase in the fixed costs reduced net profit by $7,000. The third problem area, concerning the marketing perspective, involved the difference in sales mix from actual to budget. FFL actually sold more Basic Wood Stoves and fewer Deluxe Wood Stoves than budgeted. Unfortunately, the Deluxe Wood Stove possessed a higher standard contribution margin per unit than the Basic ($210 to $80). Therefore the difference in the mix of sales caused FFL’s net profit to be reduced by $234,000 (Sales Mix Variance). Ultimately, more market research must be conducted to better understand consumer wants and needs and thus be able to efficiently budget company products accordingly to reach profitability goals. APPENDIX EXHIBIT 1| | BASIC (Actual)| BASIC (Std. | DELUXE (Actual)| DELUXE (Std. )| Selling Price| $325| $300| $700| $800| Variable Costs:| Direct Materials| $67. 50| $70. 00| $171. 00| $190. 00| Direct Labor| $104. 00| $90. 00| $248. 00| $240. 00| Overhead| $52. 00| $45. 00| $124. 00| $120. 00| Sell Admin| $15. 00| $15. 00| $40. 00| $40. 00| Total Variable Costs| $238. 50| $220. 00| $583. 00| $590. 00| Contribution Margin| $86. 50| $80. 00| $117. 00| $210. 00| CO NTRIBUTION MARGINS TABLE| Illustration of some calculations involved: *Using the Actual Results Table Provided in Exhibit A Actual Unit Selling (Basic) = Sales Revenue ? Sales Volume (units) = $2,340,000 / 7,200 units = $325 Unit Direct Materials (Basic) = Direct Materials Cost ? Sales Volume (units) = $486,000 / 7,200 units = $67. 50 *Using the Unit Cost Standards Table Provided in Exhibit B Std. Unit Direct Labor (Basic) = DL Std. Qty. Per Unit x DL Std. Rate Per Hr. = 6 hrs. x $15. 00 per hr. = $90 APPENDIX EXHIBIT 2| For the Year Ended May 31 2010| | ACTUAL| FLEX-BUDGET VARIANCE| FLEX BUDGET| SALES-VOLUME VARIANCE| STATIC BUDGET| TOTAL VARIANCE| Quantity (units)| 12,000| | 12,000| | 10,000| | Sales Revenue| $5,700,000| ($300,000)| $6,000,000| $250,000| $5,750,000| ($50,000)| Variable Costs| $4,515,600| ($99,600)| $4,416,000| ($181,000)| $4,235,000| ($280,600)| CM| $1,184,400| ($399,600)| $1,584,000| $69,000| $1,515,000| ($330,600)| Fixed Costs| $919,500| ($37,000)| $882,500| | $882,500| ($37,000)| Net Income| $264,900| ($436,600)| $701,500| $69,000| $632,500| ($367,600)| FLEXIBLE BUDGET REPORT| GIVEN CALCULATED FILL IN THE BLANK VARIANCES: ($) = UNFAVORABLE $ = FAVORABLE Illustration of some calculations involved for Flex Budget: Flex Sales Revenue = Std. Sell Price Per Unit x Actual Sales volume (units) Basic Wood Stove = $300 x 7,200 units = $2,160,000 Deluxe Wood Stove = $800 x 4,800 units = $3,840,000 Total Flex Sales Revenue = $6,000,000 Flex Variable Costs = Std. Variable Price Per Unit x Actual Sales Volume (units) Basic Wood Stove = $220 x 7,200 = $1,548,000 Deluxe Wood Stove = $590 x 4,800 = $2,832,000 Total Flex Variable Costs = $4,416,000 Flex Fixed Costs = Static Fixed Costs APPENDIX EXHIBIT 3| | FLEX BUDGET VARIANCE| SALES VOLUME VARIANCE| SALES VARIANCES| | | | Sales Price| | $300,000 U| -| Sales Mix| | -| $234,000 U| Sales Quantity| | -| $303,000 F| Sales Volume | | -| $69,000 F| TOTAL SALES VARIANCE| | $300,000 U| $69,000 F| | | | | VARIABLE COST VARIANCES| | | | Direct Materials| | $109,000 F| -| Direct Labor| | $139,200 U| -| Overhead| | $69,600 U| -| Selling Admin| | $0| -| TOTAL VARIABLE COST VARIANCE| | $399,600 U| -| | | | | TOTAL CM VARIANCE| | $399,600 U| -| | | | | FIXED COST VARIANCES| | | | Mfg. Budget| | $30,000 U| -| Sell Admin Budget| | $7,000 U| -| TOTAL FIXED COST VARIANCE| | $37,000 U| -| | | | | TOTAL VARIANCE| | $436,600 U| $69,000 F| | | | | VARIANCES TABLE| U = Unfavorable F = Favorable APPENDIX Illustration of some calculations involved in creating Exhibit 3: SALES VARIANCE Section Sales Price Variance = Actual Units sold x (Actual Sell Price – Budgeted) Basic Wood Stove = 7,200 x ($325-$300) = $180,000 F Deluxe Wood Stove = 4,800 x ($700-$800) = $480,000 U Total Sales Price Variance = $300,000 U Sales Mix Variance = (Actual Sales Mix % – Budgeted) x Actual total units sold x Budgeted CM per unit Basic Wood Stove = [(7,200/12,000)-(4,500/10,000)] x 12,000 x $80 = $144,000 F Deluxe Wood Stove = [(4,800/12,000)-(5,500/10,000)] x 12,000 x $210 = $378,000 U Total Sales Mix Variance = $234,000 U Sales Quantity Variance = (Actual total units sold – Budgeted) x Budgeted Sales Mix % x Budgeted CM per unit Basic Wood Stove = (12,000-10,000) x (4,500/10,000) x $80 = $72,000 F Deluxe Wood Stove = (12,000=10,000) x (5,500/10,000) x $210 = $231,000 F Total Sales Quantity Variance = $303,000 F Sales Volume Variance = (Actual Sales Volume – Budgeted) x Budgeted Cm per unit Basic Wood Stove = (7,200-4,500) x $80 = $216,000 F Deluxe Wood Stove = (4,800-5,500) x $210 = $147,000 U Total Sales Volume Variance = $69,000 F How to cite Ferguson Foundry Limited, Papers

Factors Caused US Financial Crisi 2008-09 â€Myassignmenthelp.Com

Question: Discuss About The Factors That Caused The US Financial Crisis Of 2008-09? Answer: Introduction Economies perform differently during various business cycles; there are two cycles; the boom (peak) period where there is an accelerated growth in the economy and the burst (recession) period where there is strained economic growth. Before 2008, the performance of the US was high. Pettinger (2017) pointed out that the US economy was stable from 2000 to 2007 with a strong growth, falling unemployment and low inflation. However, despite this economic stability Pettinger noted that there were rising concerns on the growing instability on the financial marketing and credit. There was a boom in the housing industry that resulted in an increment in the aggregate consumption component of GDP. Thus the GDP recorded before the crisis was high. This paper will analyze the changes in GDP before, during and after the crisis. During the crisis, many macroeconomic indicators performance was poor; these indicators include real GDP, Inflation, Unemployment, etc. The paper will consider the actual causes of the crisis which resulted from the money supply growth. It will cover the origination of the money supply growth. This research will show that the financial crisis in the US was as a result of failure on the financial lenders and the government. Rosner (2013) pointed out that the governments regulation on lending institutions was weak. It shall analyze how each of these parties failed and the impact of each of their failures. The impacts of the financial crisis were not only felt in the USA economy but was spread to other nations; there are just a few economies that wasnt impacted by this crisis. Some of them that are financially stable were able to implement policies that led to a quick recovery while others are constrained up to date. The Factors Responsible for the Financial Crisis Loose Monetary Policy and Money Growth In the early 2000s the US economic growth was lower which stimulated the US Central Bank to lower its interest rates. Malinen (2017) argued that prior to the crisis, the US monetary policy was loose. The impact of a lower interest rate is an increased money supply since people are attracted to loans advanced by financial institutions owing to the low cost of repayment. There was thus an increased borrowing of loans and a greater growth of the money supply in the circulation. Since investors are always uncertain about the future, they decided to utilize this available capital to invest in assets that would give them returns in the future. The major asset that demand went up was that of the housing industry. Households and investors decided to utilize this availability of cheap capital to buy homes. Fig: Growth of money supply Source: Positivemoney.org (2017) The graph shows that there was a huge money creation by the banks prior to the crisis. According to Positivemoney.org (2017), money is created every time a loan is made by the banks; the money and debt amount in the US economy had doubled in a period of seven year from the advancement of the loans. Subprime Mortgage An increased demand for homes raised the demand for mortgages. Initially, financial lenders could only advance loans to prime lenders who had good credit ratings and avoided loaning the subprime borrowers. This is what had kept the housing market in a stable state. The increased demand for mortgages resulted in the financial lenders weakening their lending standards. In the period before the crisis, banks were more aggressive and their willingness to lend to the risky borrowers had gone up (Nitta, 2013). They figured out a way to make the funds available to the low-income groups through pooling. This strategy was considered less risky but no analysis was done or had been done earlier to confirm its viability. The proposal was accepted and the financial lenders started lending to the low income groups without necessarily requesting them to provide some security. Many subprime borrowers went for the loans and there was a greater supply of money to many people in this economy. The loans were advanced as mortgage home loans meant for assisting the investors and households to acquire homes and repay as they used to houses. These subprime borrowers were risky since their income level was insufficient to service the loans; the banks failed to do a sufficient check on the ability of these borrowers to repay their loans; they recklessly gave them huge loans. The government had also set a regulation towards achieving the goal of non-discrimination on the acquisition of capital because of the brackets of income. After the credit crunch, these borrowers were left with huge unpayable loan amounts. Housing Bubble The Mortgage loans advanced to the subprime borrowers enabled them to buy homes and other houses used for businesses. The mortgage loans were given at a very low interest rate and thus attracted many borrowers. Pettinger (2017) noted that the high confidence for the borrowers and a growth in bank lending facilitated the housing boom. The access of these loans by the subprime borrowers caused the homes demand to shoot upward (Muddywatermacro.wustl.edu, n.d.). The law of demand accounts for a price rise whenever demand rises. The price rise generated great profits to the investors; more homes were constructed in order to raise more profit. Many people shifted their investment to the housing market so get a share of the rising profit Fig: Uses of money created by banks prior to the crisis Source: Positivemoney.org (2017) The greatest proportion of the huge amounts of money the banks created were used for mortgages and secured loans (Mee, 2012); this was equivalent to 31% of the total money created. The 31% went to residential property and there was a further 20% that went to commercial real estate. Credit Defaults Prior to the crisis, the personal debt in the US was very high. It even exceeded the income amount and thus at some point became difficult for the borrowers. The borrowers had to repay their loans with some stated interest rate. After the housing bubble burst, the financial lenders went into huge losses because borrowers were not able to service their loans further. The subprime borrowers couldnt repay their loans; in addition, the prime borrowers could also not be able to repay their loans. There was a great challenge for the financial account lenders. What caused the global recession is that when people started defaulting on their loans, financial institutions such as banks tightened their lending behaviors; the money supply was reduced resulting in a lowered demand for homes and subsequently a fall in price. The demand law also account for a price decline on instances where demand is insufficient. The falling prices accounted for the bursting of the housing boom. The previous borr owers could keep toping up their loans to enable them to service the loans. The slowdown of lending made it difficult to access loans owing to the panic caused to the lending institutions. This forced these borrowers to decide selling their assets and repaying the loans. However, the assets value had declined compared to when the loans were advanced and thus insufficient money were raised from such sales and the full amount of the loans was unpayable given the income constraints. Further, the increased default rates caused the banks to continue tightening their lending such that investments were completely not possible. Investors confidence had also declined and thus economic activities fell significantly; the US fell into a recession. Lehman Brothers Lehman was a giant investment bank and the 4th largest in the US. In 2003 and 2004 when the housing boom was showing up, this investment bank acquired 5 mortgage lenders. Lehman was accused of creating mortgage backed securities that were toxic and their sales put the financial market at risk (Williams, 2010). According to Alex (2017), this bank filed for bankruptcy in September 15th 2008; it was one of the largest victim of the subprime mortgages and thus argued to have been the major cause of the financial crisis (Cnbc.com, 2010). Its contribution to erosion of market capitalization was close to $ 10 trillion in October 2008. According to Mcdonald (2016), it is the collapse of this investment bank that triggered the global recession. Stock Market Crisis The US stock markets are strongly correlated with other universal related stocks; whenever it is declining, all other stocks declines. After the end of the 2000-02 stock market crush that resulted from the internet boom, the MA was plunged by lenders one again (Nations, 2017). The 2000-02 was the 5th wave of stock market crush whereas the 2004-07 was the 6th wave. The percentage of cash deals rose with this wave and the role played by the LBOs was larger than with the initial waves (Hooke, 2015). The stock market crash caused the deal volume to fall by 60% during the 2007/2008 global financial crisis. According to Amadeo, (2017), a loss in investors confidence is responsible for causing a recession. Dumping of China Treasuries Mees (2012) argued that the American spending binge was prospered by China and not by the US. The US saving rate was around 15% from 2000 to 2006 whereas that for China rose from 38 to 54% during this period. The Chinese are risk-averse and thus their savings are ties to risk-free assets. The savings buildup in China and emerging economies had expanded and caused a depression of interest rate in the whole world from 2004; the US Treasury bonds price rose as there was too much money chasing. Subsequently there was a fall in the interest rate. China and Japan have been the greatest creditors for the US. Fig: US treasuries foreign ownership Source: Gantz (2017) There was a decline in the US treasuries foreign ownership in 2008 which means that there was a reduction of the available credit; this contributed to the financial difficulties. Conclusion The US global recession was caused by the credit crunch; there was a shortage of liquidity for the banks and thus a reduced funding. The financial instability lowered businesss and consumers confidence. There was a negative wealth effect as the house prices fell after the boom. Since the economies are interrelated, the impacts of the US financial crisis were also spread to other economies and this deteriorated the trade system; there was a decline in exports as other economies also felt the financial constraints. There was a significant fall in GDP and the unemployment rate rose. There was a failure of the banks in that they recklessly advanced loans to the risky borrowers without a sufficient cross-check of their ability to repay. The government failure is argued in terms of low regulation on the lending behavior by the financial institutions. The central bank regulates the circulation of money and it could have ensured that the financial institutions did not cause such a big growth in the money supply. 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