Johnson And Johnson's Change In The Monetary Policy Of Johnson & Johnson
Johnson & Johnson 's operating arms are divided into three business arms, which are Consumer (which offers baby care, skin care, oral care, wound care and women’s healthcare products), Pharmaceutical and Medical Devices.
The United States of America Money Policy
According to the dictionary of business and economics terms, Monetary Policy can be defined as the efforts of a nation’s central bank aimed at influencing inflation rates, economic growth, and interest …show more content…
This could be in the expansionary fiscal policy, contracting fiscal policy.
Expansionary fiscal policy: this is laws passed by the legislative and executive branches to increase government spending or lower taxes, which increases the money supply in an economy. For example, when taxes reduce, the government is trying to increase the level of consumers in other to help businesses and the economy. This raise would shift the aggregate demand curve to the right; therefore, a change in policy would lead to short-term fluctuations in production and prices. That is to say, the more money in the economy the more customers would buy Aveeno Eczema Therapy.
Contracting Monetary Policy: congress and the president create these policies to increase government income while the economy is doing well and to prevent an economic bubble. It is also a policy used by authorities contract the supply of money a deduce economic activities by increasing the interest rate. This is done by a reduction in the money supply in the economy. A higher interest rate would reduce the production and demand of Aveeno eczema therapy as there would be little money in …show more content…
Below is a chart that shows how technology and productivity have helped increase the revenue of Pharmaceutical companies in the last five years. One would notice that with the increase in technology, the revenue generated by this industry has been on the high rise. Thus allowing the companies to explore better ways of improving their products. That is to say, the table shows how the increase in money has been able to aid companies in the research and development aspect.
Effects of the United States monetary policy and fiscal policy on the financial performance of Johnson and Johnson
Looking at the short-term trend of Johnson and Johnson we can see that the current monetary and fiscal policies are affecting the company’s performance as the different changes in the policies creates drawback for short-term investments which Johnson and Johnson do in retailing of their products to pharmacies on retail. While on the long-term trends the policies allow them to create a steady profit. I would say that a contracting monetary policy would do no good for Johnson and Johnson financially but the expansionary monetary policy would help in creating a better financial report for Johnson and