please answer 3 questions

1 Please write the paper in 250 words

For this Discussion Question, complete the following.

1. Review the two articles about bank failures and bank diversification that are found below this. Economic history assures us that the health of the banking industry is directly related to the health of the economy. Moreover, recessions, when combined with banking crisis, will result in longer and deeper recessions versus recessions that do occur with a healthy banking industry.

2. Locate two JOURNAL articles which discuss this topic further. You need to focus on the Abstract, Introduction, Results, and Conclusion. For our purposes, you are not expected to fully understand the Data and Methodology.

2)I need the response for the artcle below in 150 words

Bank Diversification and Failure

Money habits such as saving, spending, investing and loaning have over time evolved and improved to incorporate various things such as the formation of financial institutions that have helped through the provision of these services to all the qualified individuals. Banking has evolved over time to incorporate technology that has brought about a lot of changes in the sector ranging from automatic dispensing of money through automated teller machines and to the recent trend which is online and mobile banking which involves the use of online platforms to carry out various banking activities. Banks have also evolved in how they manage their operations and most of them have increased the number of services that they offer. Through this, they have increased the amount of revenue that the banks are getting (Pearce, 2011).

Banks have also undergone diversification meaning that they have invested in different areas that are profitable to the bank so as to make sure that the bank has enough money in case the monthly revenue targets are not met. Diversification in the banking sector is important and more banks should engage in it. Although diversification is helping with boosting the revenue for the banks, they are still failing and bank failure is defined as the inability of banks to offer services due to factors such as lack of enough funds that might have been caused by the bank misappropriating the customer’s deposit money or the bank giving out too many long term or risky loans that empty its reservoir. Diversification helps in solving these issues by providing alternative sources of revenue for the banks. The bank can sell the properties it has invested in or use the proceeds from the investments in case the bank is short of cash. The bank should make the conscious choice of investing more in assets as opposed to giving out loans that might lead to the collapse of the bank (Besley, 2009).

References

Besley, S. (2009). Principles of Finance . New York: Cengage Learning.

Pearce, L. (2011). Encyclopedia of Emmerging Industries. Gale publishers.

3 ) I need the response for the artcle below in 150 words

The main aim of the discussion in this paper is to find out if it is necessary to incorporate discretionary economic policy in boosting the economy during the recession phase. The second issue is finding out the best way of implementing the policy during a financial recession, especially when households choose to operate on the Nash equilibrium of Pareto inefficient path (Harashima &Taiji (2017). Government intervention in combating the recessive issues such as low growth of the economy and increasing rates of unemployment is also discussed.  The paper proposes different options that the government can use to participate in boosting an economy that is recessing with merits and demerits of each, as explained below.

The ultimate fiscal shock causes a downward change to a country’s economic sector, which is characterized by decreased industrial production and low consumption by households. The best way to curb this challenge is through the improvement of the utilization of produced products by the citizens. Increased consumption will lead to the high demand that can only be met through an increased rate of production. Top production results into optimum use of both capital and human resources hence high employment rates. Households are, however, known for being risk-averse and having a high desire for a smooth fiscal state thus cannot cooperate in the increase of consumption (Harashima &Taiji (2017). The government is therefore required to intervene and curb the challenge.

The government can choose to avoid the intervention, boost consumption, or reduce the tax rates in combating the challenge. Not intervening may result in low consumption hence high rates of unemployment and prolonged recession (Harashima &Taiji (2017). Participation in consumption leads to high combined use, thus high employment rates and high government rates. Reducing tax rates means more money to the households, but if they decide not to cooperate, the rate of unemployment will remain high, and national debts will also be high. The government should, therefore, choose to improve consumption, which will increase production and employment rates leading to favorable economic rates and increase tax rates in the future to pay the involved debts.

Reference

Harashima &Taiji (2017). Should a Government Fiscally Intervene in a Recession and, If So, How? Retrieved from; https://mpra.ub.uni-muenchen.de/78053/1/MPRA_paper_78053.pdf.