...1 Interpreting Macroeconomic Conditions - Assignment 4 Managerial Economics and Globalization – ECO 550 Interpreting Macroeconomic Conditions 2 This assignment involves analyzing several indicators of the of the macroeconomic conditions in an economy, such as interest rates, income, and other indicators such as CPI, inventory levels, wage rates, consumer confidence, etc. Analyze these indicators and prepare a 3-4 page report explaining the expected short impact on firms in the following industries, retail business and automobile industries in terms of product sales and operating costs. I feel it would be better served to explain exactly what macroeconomics means. Macroeconomics evaluates or examines the overall performance of the economy as a whole and in this process we can determine what causes the economy to grow and how indicators such as interest rates, income, wage rates, employment and unemployment can affect the overall performance of our economy in its current state as well as forecast predictions for the future. This type of activity and performance is often measured through the GDP (Gross Domestic Product); the total value of all goods and services in the market. This information can be applied to any firm/business to evaluate how these changes impact their product sales and operating costs in the United States. If were to evaluate a local retail business...
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...Interpreting Macroeconomic Conditions. Walmart Stock Performance During the 1970’s, Walmart offered common stock to the public. The stock was traded on New York Stock Exchange. The first cash dividend was declared. Shareholders were provided an annual dividend and paid quarterly every year (http://investors.walmartstores.com/ phoenix.zhtml? c). In 1970, Walmart offered 300,000 shares of its common stock to the public at a price of $16.50 per share. Since that time, Walmart have had eleven two for one stock splits. On a purchase of 100 shares at $16.50 per share on their first offering, the number of shares has increased. In March 1974, Walmart declared its first cash dividend of $0.05 per share. Walmart has increased its dividend every year since its first dividend (http://investors.walmartstores.com/ phoenix.zhtml?c). Walmart Current and Future Sales Revenue According to all the data that has been evaluated, Walmart is the largest retailer in the world. By the end of January 2010, Wal-Mart had more than $400 billion in revenue, $24 billion in operating income, about 8,500 stores, and nearly 1 billion square feet of space. According to statistics from the U.S. Census Bureau, about 10% and 20% total of retail and grocery sales in the US. The company controls the US retail surroundings and is growing globally at a fast pace. The company recorded revenues of $408.214 million during the financial year...
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...Both corporations, Wal-Mart and Starbucks, despite being in different industries, share the same, one goal- market domination. They each overtake their industry, operate with low costs, hire low paid stuff, and cause many small, local companies to go out of business. Nevertheless they are not being treated the same by the society; many people hate Wal-Mart, but does not mind Starbucks. Is the double standard caused by the great public relations sector, or is it just people ignorance for facts. Wal-Mart Stores, Inc is world’s largest retailer, serving their customers and members at more than 8,446 locations, under 55 different banners in 15 countries. Wal-Mart’s goal is to save people money, so they can live better, that mission was true many years ago when they opened the first store, but it was even more important during the recent economic downturn, which seems to be coming to the end (Wal-Mart, 2010). During the recent recession Wal-Mart was one of the few businesses that have not straggled; their sales revenues were really good, mainly due to their low prices, and higher- income shoppers, which have not shopped their before the times got tough, but started during the recent troubled economy. Since the wealth started getting better and the consumer spending improved, they seems to be going opposite way, Wal-Mart’s sales have been decreasing this year, sales growth in last quarter against last year were at: -12.15%. Last year during the fourth quarter, the Christmas season...
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...Assignment #4: Interpreting Macroeconomic Conditions Eddie Dozier Strayer University Dr. Ibe ECO 550 June 5, 2011 Interpreting macroeconomic conditions involves analyzing several indicators of the macroeconomic conditions in an economy, such as interest rates, income, and other indicators such as CPI, inventory levels, wage rates, consumer confidence, etc. This report will analyze a few of these indicators explaining the expected short impact on firms in the healthcare and automobile industries in terms of operating costs and product sales. There are a large number of variables or characteristics used to gauge the health of an economy, with four of them usually referred to as the key macroeconomic variables: aggregate output or income, the unemployment rate, the inflation rate, and the interest rate. There are, however, numerous additional measures or variables that are collected and used to understand the behavior of an economy. In the United States, for example, additional measures include: the index of leading economic indicators (which gives an idea where the economy is headed in the near future); retail sales (which indicate the strength of consumer demand in the economy); factory orders, especially for big ticket items (which indicate the future growth in output, since the orders will have to be filled); new automobile (robust increase in new automobiles are usually taken as a sign of good growth in the future); the consumer confidence index...
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...Interpreting Macroeconomic Conditions We live in a global economy. There are trading exchanges all over the world, i.e. China, Tokyo, Brazil, Russia, India, Australia, London, etc. The stock exchanges in China and Brazil are some of the largest in the world. Everybody in the world can access securities exchanges via the Internet. The dollar is weak right now. Europe has a debt crisis and the Euro is not so stable. Not long ago, one of Europe’s leading independent forecasters for the Treasury asserted that the Euro could collapse as a result of Europe’s debt crisis. The European Central Bank’s Governing Council Member asserted that it is not up to the bank to save countries where governments run the risk of being insolvent. Germany had good growth in 2010 but their economic model is centered on exports, i.e. cars and machines. Asia (China) drove Germany’s growth in 2010. Can Germany sustain their economic model since other European countries have stagnant economies re: exports and imports? The European debt crisis has pushed the Euro down which has made German exports more competitive. Right now, US exports are even better than German exports because the US dollar is weak, too. Since Germany appears to be in the best economic position in Europe more people are putting capital in Germany when investing in Europe. German exporters could take a huge hit if Europe’s debt crisis runs into other European countries. Unemployment rates were lower in April than a year...
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...Eric Carr Unit 2 Individual Project BUSN300 - 1303A – 03 Professor Rodney Cullifer 8/6/2013 When we think about GDP, it is important to determine the country’s output. When I say the country’s total output I mean everything produced by the people of the country, as well as all the companies within the country. Today I will be discussing to you all the recent history and expected future conditions of the American economy. In the current American economy, we must concentrate on the future. The current trends that are taking place in our economy are essential for determining the future of the U.S. economy. Some of the trends in the U.S. economy consist of business cost rising due to uncertainly. What this means is that as a result of the 2008 financial crisis, businesses have to change their way of doing business just to keep up. Another trend is companies hiring less full-time workers and more part-time, and temporary employee. The reason that companies do this is because they want to keep their overhead low, remain flexible in an unstable environment, and to keep from paying higher health care benefits. The U.S. economy is gradually declining in global economic power. According to current trends the U.S. will take part in another major crisis, but will not have an economic downfall. Current statistics about the U.S. economy indicates that the economy is growing at a fast rate. The moderate growth rate is about 2-3% which is good enough to create more jobs but it will...
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...National Cheng-Chi University 研究所MBA: Tuesdays 6:10-9 Commerce Building 260306 Yee-Tien (Ted) Fu Undergraduate: Tuesdays 9:10:noon Commerce 260508 Autumn 2009 (3 units) Course Objective This course examines important issues in the rapidly evolving area of international financial markets. It focuses on various aspects of international portfolio management and open-economy macroeconomics, and is a natural extension to the theories and practical issues explored in Investments and/or Finance. This course is aimed at students wishing to acquire a sound understanding of the main opportunities in international investments. For example, the relevance of hedging in the management of currency risk will be studied in light of theoretical results and empirical evidence. We will also briefly cover foreign direct investment (FDI), since in general, the revenue generated from FDI by U.S. firms is about three times as large as the revenue generated from the exporting of U.S. goods by U.S. firms. Due to the ever increasing importance of international corporate governance, there is a corresponding need to decipher and use information in financial reports. At least one class meeting and one case study will touch on some key issues in international financial reporting and analysis, such as financial disclosure/transparency, incentives for off-balance sheet liabilities, hedge accounting, lease accounting, footnote disclosures, and intercorporate equity investments, and international...
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...Chapter 1 -The global manager’s environment Sources of Risk for International Managers -Exogenous- General environmental factors, industry-related uncertainties and some firm-specific uncertainties. -Endogenous- Uncertainties that arise from within the firm, and include managerial perceptions, attitudes and organizational perspectives. -Top two exogenous risks facing business leaders and policy makers for 2012 and the next decade would be severe income disparity (The unequal distribution of household or individual income across the various participants in the economy) and chronic fiscal imbalances (situation where all of the future debt obligations of a government are different from the future income streams) -Other issues: natural disasters such as 2011 earthquake in Japan, flood in Thailand, Political uncertainty in China and Middle East -Globalization has compounded the types and level of business risks. *Typical challenges that managers face involve politics, cultural differences, global competition, Terrorism and Technology. Managers in companies are struggling to find ways to balance their social responsibilities, their images, and their competitive strategies. -PESTEL- An analytical tool to develop and understanding of exogenous risk -Pestel analysis- Political, Ethical, Social, Technological, Environmental and legal understanding or environmental scanning that is CRITICAL if we are to strategically plan and develop our value proposition. -> Exogenous creates...
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...The Cobb-Douglas Production Function Introduction A production function is a function which relates the factors of production, capital and labour, to output given the available technology. Capital here refers to things workers use in producing goods and services such as computers. Labour refers to the time that people spend working. The production function can thus be written as: Y = F(K, L) where Y denotes output, K denotes capital, L denotes labour and F is the relationship between the factors of production and output. Knowing the specific form of the production is important as it can explain the incomes of capital and labour, i.e. how much of output is compensated to workers and how much is compensated to owners of capital. This may seem a daunting task given modern economies’ vast array of industries which use labour and capital differently but there is a particular form which has proven to be resilient since its discovery. In 1927, Paul Douglas, a professor of economics in the United States (U.S.), discovered a pattern in data he had constructed from 1899 to 1922. Labour share of total income was relatively constant over this long period. This meant that even as the economy grew, total income of capital owners and workers grew at almost exactly the same rate. He consulted Charles Cobb, a mathematician and colleague, on what sort of production function would yield constant factor shares. Cobb showed that the function with this property was: Y = F(K, L) = AKαL1-α, where...
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...Get to Know the BAT Table of Contents Introduction Test Overview Sample Questions Scoring Introduction We are excited about your participation in the Bloomberg Assessment Test (BAT). The BAT is a global, standardized online exam that the Bloomberg Institute has developed in partnership with premier companies, university faculty, and business professionals around the world. The test is designed for undergraduates and recent graduates who are interested in an entry‐level job in the business world. The following information packet is intended to familiarize you with the content and structure of the BAT. Enclosed you will find information about the test’s goals, sections, and scoring. There is also a list of annotated sample questions for you to review. If you have any additional questions about the content of the test, please feel free to contact us at bat@bloomberginstitute.com. Table of Contents Introduction Test Overview Sample Questions Scoring Test Overview The BAT aids employers in identifying and screening students who wish to pursue a career in the business world. Test takers should have a general understanding of and familiarity with current events in business, finance, and economics; however, much of what is being assessed is a person’s aptitude and skills to be successful in business. 3 hours 10 sections 150 questions The following pages discuss the different sections of the BAT and the concepts you can expect to see. Test Overview ...
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...the conventional explanation of the early stages of the crisis.” (Hill, p.3) How it all began, what factors caused the crisis, what segments were affected the most, what was the backup plan, and what policies should have been taken to prevent the crisis are the points that this paper will cover. First and Second-Generation Models According to 1996 annual report of Bank for International Settlements (BIS), pre-crisis fundamentals exhibit economic performance of Asian countries. They’ve experienced moderate inflation rates of about 6%, high savings rate of 32%, and trade openness indicators of 39%. Table 1: East Asian Economic Conditions Before Crisis Although accounting and macroeconomic analytics have failed to foreseen the currency crisis, which is inevitable, first and second-generation models explain us was it due to weakening macroeconomic fundamentals or financial contagion. In accordance to first-generation model developed by Krugman 1979, market-speculative movements, in response to policies, are incompatible with fixed exchange rate regime. What it means is that “speculators who want to make a profit can buy foreign exchange reserves causing its exhaustions and forcing the country to devalue or abandon the exchange rate peg.” As many studies have argued, the Asian crisis represents the consequence of its own acts in corporate as well as financial sector. “The weak-post crisis performance has...
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...Annales Universitatis Apulensis Series Oeconomica, 15(2), 2013, 594-604 ANALYSIS OF THE ROMANIAN BANKS’ PERFORMANCE THROUGH ROA, ROE AND NON-PERFORMING LOANS MODELS Adela Socol1 Adina Elena Dănuleţiu2 ABSTRACT: General assumption of this study is that the banks performance represents their ability to generate sustainable profitability and that banks’ profitability is one important issue of contemporary banking field, grace to its role in emphasizing of the financial soundness of banks, abreast to others indicators regarding to the capital adequacy or assets quality. The paper examines how is affected banking profitability (expressed through traditional measures of performance ROA - Return on Assets and ROE - Return on Equity) by the CRR Credit risk ratio in Romanian banking system during March 2008 - June 2013. We developed two regression models in order to study the dependence between mentioned variables. We found that ROA and ROE vary each of them depending on the CRR Credit risk ratio, which is expressed as the ratio of gross value of exposure to loans and related interest under “doubtful” and “loss” to total classified loans and related interest pertaining to non-bank loans, off-balance sheet items excluded. Keywords: ROA Return on Assets, ROE - Return on Equity, Credit risk ratio, Regression model JEL Codes: D12, C58, G21 Introduction Significant level of non-performing loans and faster cross-border deleveraging are considered the major weaknesses...
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...About the BAT with Sample Questions Table of Contents Introduction Test Overview Sample Questions Scoring Introduction We are excited about your participation in the Bloomberg Aptitude Test (BAT). The BAT is a global, standardized online exam that the Bloomberg Institute has developed in partnership with premier companies, university faculty, and business professionals around the world. The test is designed for undergraduates and recent graduates who are interested in an entry-level job in the business world. The following information packet is intended to familiarize you with the content and structure of the BAT. Enclosed you will find information about the test’s goals, sections, and scoring. There is also a list of annotated sample questions for you to review. If you have any additional questions about the content of the test, please feel free to contact us at bat@bloomberginstitute.com. Table of Contents Introduction Test Overview Sample Questions Scoring Test Overview The BAT aids employers in identifying and screening students who wish to pursue a career in business and finance. Test takers should have a general understanding of and familiarity with current events in business, finance, and economics. However, we are not assessing knowledge: we are assessing a person’s aptitude to be successful in these fields, regardless of background. 2 Hours 8 Sections 100 Questions Chart and Graph Analysis 12% News Analysis 12% Global Markets...
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...Research Proposal “The Impact of Asset Liability Management on Banks Profitability: A Comparative Study on Ethiopian Commercial Banks” Prepared by: Samson Abate ID No. GSE/1482/08 Submitted to: Samuel Kifle(Phd.) In Partial fulfilment of Business Research Methods Course January, 2016 Abstract Banks’ profitability is of utmost concern in modern economy. Banks are in a business to receive deposits or liabilities and to issue debt securities on the one hand and create or invest in assets on the other hand. Commercial Banks incur costs for their liabilities and earn income from their assets. Thus profitability of banks is directly affected by management of their assets and liabilities. In addition, different market and macroeconomic factors also influence the ability of the banks to make profits. The asset and liability base of banks in developing countries are narrower than their counterparts in developed countries. This study examines how asset and liability management together with external variables such as degree of market concentration and inflation rate impact the profitability of selected commercial banks in Ethiopia. Although impact of the management of banks’ asset and liability on their profitability has been studied by a number of researchers, the issue of banks’ profitability in Ethiopia has received scant attention from the researchers. This study is an attempt to close this gap, to bring the issues of banks’ assets and liability management in Ethiopia...
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...About the BAT with Sample Questions Table of Contents Introduction Test Overview Sample Questions Scoring Introduction We are excited about your participation in the Bloomberg Aptitude Test (BAT). The BAT is a global, standardized online exam that the Bloomberg Institute has developed in partnership with premier companies, university faculty, and business professionals around the world. The test is designed for undergraduates and recent graduates who are interested in an entry‐level job in the business world. The following information packet is intended to familiarize you with the content and structure of the BAT. Enclosed you will find information about the test’s goals, sections, and scoring. There is also a list of annotated sample questions for you to review. If you have any additional questions about the content of the test, please feel free to contact us at bat@bloomberginstitute.com. Table of Contents Introduction Test Overview Sample Questions Scoring Test Overview The BAT aids employers in identifying and screening students who wish to pursue a career in business and finance. Test takers should have a general understanding of and familiarity with current events in business, finance, and economics. However, we are not assessing knowledge: we are assessing a person’s aptitude to be successful in these fields, regardless of background. 2 Hours 8 Sections 100 Questions Chart and Graph Analysis 12% News Analysis 12% Global Markets 14% ...
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