Chapter 13.5, Problem 5R

To determine

To ascertain: The two innovations that had the most influence on the American economy.

Explanation of Solution

The two innovations that had the most influence on the American economy are as follows:

A number of economists agree that a big explanation for business cycles is the shifting policies of the federal government. There are two ways in which the government affects economic activity: through its expenditure and taxation policies and through the management of the money supply available in the economy. Steam power, technological innovations and electricity, changed daily life significantly in the 10th century.

The railroad managed to influence the USA. People who were far away were connected by the telephone, telegraph, and printing machine. Innovation contributes to the growth of the economy through rise in labor efficiency, and production a greater amount of commodities and services.

Economics Concept Introduction

Introduction: Innovation is the mechanism by which the economy creates and uses new innovations. A very broad definition of technology is used by economist, and while talking about innovation, we're talking not only about new devices or inventions, but about any new way of doing things.