...“Course Project- Part 2” Business Economics GM 545 Dunya Alaasemi Dalaasemi@yahoo.com Chapter 15, Question 14 According to Ott (2008), “National income is the total market value of production in a country’s economy during a year. It can be measured alternatively and equivalently in three ways: The value of expenditures, the value of inputs used in production and the sum of value added at each level of production” It is a system employed to account for and document economic changes. A national income account system is employed to account for and record economic changes. Investopedia (2012) stated that it provides economists and statisticians with detailed information that can be used to track the health of an economy and to forecast future growth and development. Although national income accounting is not an exact science, it provides useful insight into how well an economy is functioning, and where monies are being generated and spent. The following are some of the metrics calculated by using national income accounting include gross domestic product (GDP), gross national product (GNP) and gross national income (GNI). Ott (2008) found that using these “Statistics as an indicator of standard of living can be erroneous as the result of multiple inaccuracies or conclusions drawing from the data”. Therefore, as indicated in Econport (2006) handbook the following are the limitations of the national income accounts: * Errors in Measurement: Black Market and underground...
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...GM 545: Business Economics Chapter 16, Question 5 Unemployment rates in the U.S. are classified under two types, the frictional and structural unemployment. Frictional unemployment depends on the level of demand while structural unemployment depends on the relationship between labor skills and industrial changes that are mostly related to technology (Gilpatrick 1966). Frictional unemployment will always be present in any economy, even a high performing one, and is also vital and beneficial to every economy. A recent study suggested that the industrial structure of cities plays an important role in determining the national rate of unemployment. The more industrially diversified the city is, the lower the rate of unemployment and the more evenly distributed employment is across industries (Simon 1988). Frictional unemployment occurs naturally and appears when an individual is between jobs. This is typically a temporary transition from one position to the next. These individuals may be classified as first time job seekers, recent college graduates, or career advancers looking to hold out for corporate climb. These individuals are frictionally unemployed because they are not taking other career opportunities and are holding out for a better position. When a person quits their job to relocate, they are also considered frictionally unemployed. Another example of frictional unemployment is when a company decides not to hire due to lack qualified applicants that would be able to...
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...The Baldwin-Wallace College Journal of Research and Creative Studies, Fall 2007, 1(1):12-24 Performance of the South Korean Automobile Industry in the Domestic and United States Markets Robert R. Ebert1 and Mariel Montoney2 1 2 Department of Economics, Baldwin-Wallace College, 275 Eastland Rd., Berea, OH 44017; Economics Program, Baldwin-Wallace College, 275 Eastland Rd., Berea, OH 44017 The South Korean automobile industry has undergone considerable growth since its inception in the 1960s. That growth was initially driven by domestic demand. Since the Asian financial crisis of 1997, however, production increases for the South Korean automobile industry have been primarily a function of export sales. The research presented here explores changes in the structure of demand in its two principal marketsdomestic South Korean market and the United States market. Two models of demand are developed- one for each of the markets. Several macro economic variables are identified that have a statistically significant relationship with the demand for automobiles in each of the markets. An interesting finding of the research is that the factors apparently driving demand are different in the two markets suggesting the structure of automobile demand in South Korea differs significantly from the demand for that country’s vehicles in the United States. A major challenge facing the South Korean automobile industry is how to utilize its capacity when confronted with...
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...Edgar A. Ghossoub ECO2013 Fall 2011 Exam I Version A: Duration: 75 minutes. You must use a SCANTRON answer sheet to record your responses and you may use a simple basic calculator. You may not keep this test when you are finished. 1. If the GDP is $20,000 and investment spending is $8000, consumer spending is $9000 and net export is $1000. What is the Government Spending for this period? a. $10000 b. $8000 c. $2000 d. $‐10,000 Ans: C 2. If the Value of the dollar depreciates against the Euro: a. Imports from Europe would stay the same b. Imports from Europe would increase c. Imports from Europe will fall and Exports to Europe will increase d. Export to Europe would decrease Ans: C 3. GDP2010 = $50 Million , GDP2011 = $100 Million, P2010 = $10 and P2011 = $5 Calculate RGDP2011 using prices in 2010 as base year. a. 200 million b. 100 million c. 25 million d. not enough information Ans: A 4. The labor Force consists of a. all in the working age group b. those actively seeking work c. Those who are working d. Both b & c Edgar A. Ghossoub ECO2013 Fall 2011 Ans: D 5. Suppose #Unemployed = 60, Working age group = 1200. Calculate the unemployment rate? a. 5% b. 25.5% c. can not be determined d. 8% Ans: C 6. Suppose Employed = 50, # of Unemployed = 20, size of working age Population = 200, what is the Labor Force Participation Rate (LFPR)? a. Can not be determined b. 25% c. 35% d. 10% Ans: C 7. Cyclical Unemployment: a. Changes with the...
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...was built under his instruction close to the falls of St. Anthony, which is by the Mississippi River in Minneapolis. Back in the 1860’s General Mills had only two flour grinders using better quality ingredients, which led the way for other competitors to follow. Dating back closer to our age, during the 1960’s General Mills came out with such products as Play-Doe, Easy Bake Ovens, and Nerf balls just for kids. The company was founded by Illinois Congressman Robert Smith, who leased power rights to mills operating along the west side of the Saint Anthony Falls on the Mississippi River. Cadwallader C. Washburn acquired the company shortly after its founding and hired his brother, William D. Washburn to assist in the company's development. General Mills operates in three different business categories. The three include U.S. retail, international, and convenience stores and foodservice. The industry that General Mills is a part of is the “food consumer products” as it’s shown on fortune 500. General Mills Inc. is a manufacturer and marketer of branded consumer foods sold through retail stores. They supply branded and unbranded food products to the foodservice and commercial baking industries. As for their revenues, GM managed to reach a net sales amount of $17,910,000 as of May 25 2014. That was a 1% increase from one year ago on the same date of May 25 of 2013 for $17,774,000. However, their current revenues are at $17,642,000. GM was able to give stockholders more than $2.7...
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...Macroeconomists have for a long time outlined that GDP strongly depends on consumption and the percentage of consumption dictating GDP at any given time stands at 70%. However, in August of 2011, the consumer based comfort index became the weakest since March of 2009, and the confidence level among the US-based consuming community dropped to the lowest level since the 2008 financial crisis (Hubbard & Antony, 2012). Automobiles are long term or durable products that most customers can prefer to sideline them in their budget if they are not sure of their future job status, and therefore ending up lowering the GDP of the automobiles. GDP has been at a drop, and it only started to rise from September of 2009 but the same evidence started to diminish considerably in 2010 (Akerson, 2014). The rise and fall of the GDP reflect...
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...[pic] Many fleet cars were bought with an option to sell them back to the manufacturer. Such vehicles were called “program cars”, as distinct from “risky cars” which were not covered by a put option. Roughly 85 % of Hertz’ domestic fleet and 74 % of its international fleet were program cars. Program cars will become more expensive in the future due to the fact that Ford and GM adopted new market strategies that deemphasized lower-margin sales of program cars Risk cars exposed the company to residual value risk. Generally less expensive than program cars. What could be the possible motivations for CD&R to buy (syndicated) Hertz? • Under exploiting of the firm’s potential due to mismanagement. Hertz managers were overconfident. The senior guys were absolutely convinced that they were running the most efficient, most productive, well-organized, well-oiled machine in the industry. • The room for increasing the operational efficiency. Value creation through cost savings. • Potential improvement of the capital structure. Lower cost of capital through extensive securitization. • Hertz was undervalued. • Unique strong brand • On airport market leadership • Good historical performance Operational Efficiency Improvements • U.S. RAC on airport operating expenses CD&R estimated that labor per transaction, administrative, and other costs had increased 41 %, 65 % and 30 %. • U.S. RAC off-airport strategy CD&R proposed to slow expansion...
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...allowances impacted sales positively during the months they were shipped. Inventory build-up from shipment of consumer packs created a lag in the subsequent months. Brand managers also provided information on competitor’s strategies and pricing. Management did not consider the following factors and we believe they also affect the demand of shipments of Treat: 1. Increases in the price of raw material: Increases in supply costs will increase production costs and ultimately increase the price of Treat to market. If the price of Treat increases, ceteris paribus (all else remain unchanged), the quantity demanded may fall resulting in reduced shipments. 2. Substitutes and other complimentary products: Price increase in complimentary products like milk may influence consumer’s decision to find other substitutes and shift the demand curve to the left. Contrary, a rise in the price of a substitute may increase the demand and shift the demand curve to the right. 3. Changes in income levels: The customer segment of Treat that is price sensitive will be impacted by any variation in their income levels. Recommendations to improve Company’ Forecast and Budgeting Process and to enhance Profitability 1....
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...Block IV MACROECONOMICS – II UNIT 17 Inflation 1-14 UNIT 18 Banking and Money Supply 15-31 UNIT 19 International Trade and Balance of Payments 32-50 UNIT 20 Economic Indicators 51-62 UNIT 21 Business Cycles 63-71 UNIT 22 Economic Growth, Development and Planning 72-84 Economics for Managers Expert Committee Dr. J. Mahender Reddy Vice Chancellor IFHE (Deemed to be University) Hyderabad Prof. Y. K. Bhushan Vice Chancellor IU, Meghalaya Prof. Loveraj Takru Director, IBS Dehradun IU, Dehradun Course Preparation Team Prof. Ramalingam Meenakshisundaram IFHE (Deemed to be University) Hyderabad Ms. Pushpanjali Mikkilineni IFHE (Deemed to be University) Hyderabad Mr. Pijus Kanti Bhuin IU, Sikkim Ms. Preetaq Dutta Rai IU, Jharkhand Ranchi Prof. S S George Director, ICMR IFHE (Deemed to be University) Hyderabad Dr. O. P. Gupta Vice Chancellor IU, Nagaland Prof. D. S. Rao Director, IBS, Hyderabad IFHE (Deemed to be University) Hyderabad Ms. Hadiya Faheem IFHE (Deemed to be University) Hyderabad Mr. Mrinmoy Bhattacharjee IU, Mizoram Aizawal Prof. Tarak Nath Shah IU, Dehradun Mr. Manoj Kumar De IU, Tripura Agartala © The ICFAI University Press, All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means – electronic, mechanical, photocopying or otherwise – without prior permission in writing from The ICFAI University Press, Hyderabad. Ref. No. Eco Mgrs SLM – 09...
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...America Equity Research 22 September 2014 US Automakers See Attractively Deep Value in GM As We Roll Out 2016 Estimates for US Automakers; Like Ford; Cautious on TSLA We introduce our 2016 estimates and roll-forward valuation for GM and Ford, finding +50% upside in the case of General Motors and +32% in the case of Ford. Our established 2015 price targets increase on newly considered 2016 earnings rather than 2015 in our valuation analysis and on capital structure roll-forward as the firms generate sizable cash flow. 2016 earnings are expected to rise relative to 2015, on industry tailwinds (continued trend toward more normal volumes in Europe, cycling past a period of atypically strong macro headwinds in South America, robust growth in China, and continued cyclical increase in North America even if at a lesser rate) as well as various different self-help initiatives (e.g., as restructurings in Europe, Australia, and elsewhere take further hold, and on cost control efforts in North America). We reiterate our Overweight ratings on both GM and Ford, seeing more value in automaker stocks than in supplier stocks generally, on earnings that are growing almost as quickly as the average supplier over our newly extended forecast window (and at least as structurally improved relative to history) but valuation which is only in line with historical average (Ford) or even significantly below (GM). We are more cautious on Tesla, however, with our Neutral rating balancing incremental news...
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...Industrial and Corporate Change, Volume 19, Number 1, pp. 81–116 doi:10.1093/icc/dtp032 Advance Access published June 22, 2009 Who profits from innovation in global value chains?: a study of the iPod and notebook PCs Jason Dedrick, Kenneth L. Kraemer and Greg Linden This article analyzes the distribution of financial value from innovation in the global supply chains of iPods and notebook computers. We find that Apple has captured a great deal of value from the innovation embodied in the iPod, while notebook makers capture a more modest share of the value from PC innovation. In order to understand these differences, we employ concepts from theories of innovation and industrial organization, finding significant roles for industry evolution, complementary assets, appropriability, system integration, and bargaining power. Downloaded from icc.oxfordjournals.org at University of Dhaka on June 19, 2011 1. Introduction The power of innovation to reward pioneers with exceptional profits is well known. Yet, as recognized in various strains of the business strategy literature, the value generated from the innovation is generally shared by the innovator with some combination of component suppliers, intellectual property owners, providers of complementary products and services, competitors, and consumers. This is all the more true as firms focus on a set of core activities and rely on a network of allies and suppliers to help them create and produce innovative products. In such...
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...cc * Week 2 * Rationally, you should compare marginal benefit with marginal costs Do (all) individuals make rational decisions all of the time? * NO (Economies is a study of how rational individuals make decisions) Examples: * Many restaurants do stay open for lunch, although there are relatively few customers * Number of motor vehicle accidents does go up subsequent to introduction to seatbelt legislation Agenda Key Concept: Comparative Advantage Production Possibilities Frontier Constant opportunity cost Increasing opportunity cost Comparative advantage and the gains from trade The production possibilities frontier and the gains from trade * Specialization: * Individuals: Produce one (or few) goods BUT purchase many goods * Countries: Import and Export many Goods Trade/Exchange * What is the source of the gains from trade/exchange? * Comparative Advantage * Productions possibilities frontier: * Constant opportunity Cost * Scarcity * Trade-Off * Opportunity Cost * Switch from ALL gumdrops to ALL chocolates * Chocolate=2gumdrops * One gumdrop=one chocolate * Note: straight line (linear) PPF implies that these opportunity costs for not change along the PPF * For an example of a production possibilities frontier that is not linear, see Mankiw, Chapter 2, pages 26-28 Comparative Advantage and the gains from trade * An individual (or country) has an comparative...
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...“The Labour Market” Canadian automotive industry has taking a huge leap forward since its past years, considering the fact that population is growing each and every day. In Canada, transportation has become a very significant part of life and hence people travel through different modes of transportation each and every day. This substantial growth has also proven to maximize the profit ratio which is hence helping to keep the economy stable. This advancement in transportation is proving as an advantage especially to many car companies which reside in Canada. At certain times transportation becomes a major problem in certain places where the frequency of vehicles is low and this becomes a major problem for the working class individuals. The busy hours or the peak hours as they say is the time when maximum population use these transportation systems to reach their destination; hence this is where the problem arises. Certain types of transportation system are only able to accommodate certain percentage of people at a time and hence the latter would have to wait for the next transportation arrival. Moreover, at times certain mode of transportation does not even serve the purpose of travelling great distances and other times it is the expense of such transportation systems that leaves the person overwhelmed and results in him buying his own vehicle. Hence the Canadian automotive industry serves the purpose of providing these modes of transportation (cars, trucks, vans, etc.) to its...
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...diligence and working on a complex financing scheme in preparation for a final bid due August 30. George Tamke, a CD&R operating partner, led a team that identified and quantified significant opportunities to improve Hertz’s operating efficiency. At the same time, CD&R financial partners David Wasserman, Michael Babiarz, and Nathan Sleeper worked on a capital structure that would lower Hertz’s capital costs substantially, partly by making use of asset-backed securities (ABS) secured by its large fleet of rental cars. The combination of potential operating and financing efficiencies made Hertz an attractive investment opportunity. However, the proposed transaction entailed substantial risks. Hertz’s business was mature, capital intensive, and cyclical. The company faced well-established competition in all its major markets and had long operated with relatively little leverage under the protection of a large parent corporation. The proposed transaction would create a financing structure that was not only highly levered but also novel and complex. And Hertz would...
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...FOOD SECURITY IN BANGLADESH (Md, Ibrahim kholilullah, AGRICULTURAL ECONOMICS ,2ND BATCH ,SYLHET AGRICULTURAL UNIVERSITY ,01718996557) The world summit of 1996 defined food security as existing ‘when all people at all times have access to sufficient, safe, nutritious food to maintain a healthy and active life’. Commonly the concept of food security is defined as including both physical and economic access to food that meets peoples dietary needs as well as their food preferences. In many countries ,health problem related to dietary excess are an ever increasing threat, infact ,malnutrition and food borne diarrhea are become double burden. Food Security Status and Challenges: Food security situation in Bangladesh has improved, especially on the availability side, and further improvements on access and utilisation, to be sustainable and large-scale, needs renewed efforts from the government, civil society (including media) and the development partners. Records say in 70s’, 70% people were under the food consumption poverty line. Today this is down to under half of the population. Today, though people are not dying, they are going hungry and becoming stunted with reduced mental and physical capacity. They are suffering. The hungry population of over 60 million people is larger than most other global cases- the third largest poor population in any country after China and India5. Nearly half of Bangladesh’s children are underweight, making it one of the most severe...
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