...loan-level econometric models for default, prepayment, and severity. These models are integrated through common dependence on local macro-economic factors, which can be either simulated at national, state, and Metropolitan Statistical Area (MSA) levels or input in the form of stress scenarios. This integration produces correlation in behaviors of loans across the portfolio. The simulation incorporates a multi-step Monte Carlo approach and generates monthly P&I cash flows and losses which enables the model to be used for ALM applications or to be combined with an external cash flow waterfall tool and used for simulation of RMBS transactions. Scenario and stress testing is also done in a multiperiod framework. Furthermore, the model accommodates both loan-level and portfolio-level mortgage insurance. The resulting tool can be used for analyzing the credit risk in both portfolios of whole loans and RMBS transactions. © 2011 Moody’s Research Labs. All rights reserved. Many past and present members of the current research group made significant contributions to the building and implementation of the models underpinning the Mortgage Portfolio Analyzer. Xufeng (Norah) Qian and Weijian Liang helped build the prepayment models. Weijian Liang also helped estimating the severity model. Jordan Mann helped model MI. Pouyan Mashayekh helped model the macro economic factors. Samuel Ring,...
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...and forces” outside marketing that affect marketing management’s power to develop and sustain successful transactions with its target consumers. Macro-forecasting in industrial settings is basically concerned with the forecasting of markets in total. This concerns the existing level of market demand, while also considering the market’s future. New homes are a product offered within an industry (construction), in which macro-trends could have a major impact over the next five (5) years. An organization’s macro-environment relates to the larger forces having a direct impression on society as a whole. An organization has little, if any ability to sway these said forces, and thus can only adapt its marketing mix to provide a reason for the resulting opportunities and threats. (Weigand, Robert A. 2012) There are many features of an industry that may determine the degree of competition, as well as the relative position of profitability in an organization. Several macro-trends encompass industry forecasting and can impact either negatively or positively within an organization. The macro-trends include: Economic trends: In this particular macro-trend the macro environment analysis identifies trends such as changes in personal disposable income, interest rates, inflation, employment ratings, and cost of living. The economic environment ascertains the strength and size of a market. (www.oup.com ) Excessively high interest rates may discourage investment in new home construction...
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...and forces” outside marketing that affect marketing management’s power to develop and sustain successful transactions with its target consumers. Macro-forecasting in industrial settings is basically concerned with the forecasting of markets in total. This concerns the existing level of market demand, while also considering the market’s future. New homes are a product offered within an industry (construction), in which macro-trends could have a major impact over the next five (5) years. An organization’s macro-environment relates to the larger forces having a direct impression on society as a whole. An organization has little, if any ability to sway these said forces, and thus can only adapt its marketing mix to provide a reason for the resulting opportunities and threats. (Weigand, Robert A. 2012) There are many features of an industry that may determine the degree of competition, as well as the relative position of profitability in an organization. Several macro-trends encompass industry forecasting and can impact either negatively or positively within an organization. The macro-trends include: Economic trends: In this particular macro-trend the macro environment analysis identifies trends such as changes in personal disposable income, interest rates, inflation, employment ratings, and cost of living. The economic environment ascertains the strength and size of a market. (www.oup.com ) Excessively high interest rates may discourage investment in new home construction...
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...BANK OF SAN FRANCISCO WORKING PAPER SERIES Macro-Finance Models of Interest Rates and the Economy Glenn D. Rudebusch Federal Reserve Bank of San Francisco January 2010 Working Paper 2010-01 http://www.frbsf.org/publications/economics/papers/2010/wp10-01bk.pdf The views in this paper are solely the responsibility of the authors and should not be interpreted as reflecting the views of the Federal Reserve Bank of San Francisco or the Board of Governors of the Federal Reserve System. Macro-Finance Models of Interest Rates and the Economy Glenn D. Rudebusch∗ Federal Reserve Bank of San Francisco Abstract During the past decade, much new research has combined elements of finance, monetary economics, and macroeconomics in order to study the relationship between the term structure of interest rates and the economy. In this survey, I describe three different strands of such interdisciplinary macro-finance term structure research. The first adds macroeconomic variables and structure to a canonical arbitrage-free finance representation of the yield curve. The second examines bond pricing and bond risk premiums in a canonical macroeconomic dynamic stochastic general equilibrium model. The third develops a new class of arbitrage-free term structure models that are empirically tractable and well suited to macro-finance investigations. This article is based on a keynote lecture to the 41st annual conference of the Money, Macro, and Finance Research Group on September 8,...
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...develop learners’ ability to evaluate the elements of the macro environment and its relation to an organisation. Select an organisation which you are familiar with. Explain the elements of its macro environment and discuss how these element(s) affect your selected organisation. Recommend improvements that can be made by the organisation in managing the macro environment effectively. Criteria Description on the selected organisation Description on the general macro environment elements Identification and discussion on element(s) of macro environment that affects the selected organisation Recommendations to improve management of the macro environment in the selected organization 1.0 Introduction A macro environment comprises the external factors that can significantly impact its performance and ability to compete in its marketplace. These factors are often out of the control or management ability of a company. Factors typically include economic, demographic, political, and technological forces in business. Business owners and managers often spend copious amount of time and effort to assess the overall economic environment in order to determine the number and strength of each factor. Strategies and performance reviews can help owners and managers use the macro environment factors to create a competitive advantage for their respective companies. For companies with a global foot-print, their exposure to macro environment elements is magnified. The Coca-Cola...
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...Strategic Planning Template Macro Environment Analysis Whatmakesagoodleader.com 1.1 External or Macro Environment Analysis Review the macro environment and list the trends that may affect your business. When completing a macro environment analyses you will be seeking to answer the questions “what will affect the growth of our industry as a whole” and “What is the likely impact of all of the things that affect the growth of our industry” The things that may affect your industry as a whole may also affect many industries, such as interest rate rises, however you are only concerned with the things that affect your industry. This template contains examples of trends to consider, the list is to be considered by no means exhaustive. You will have to review the examples provided and update the list with the trends that are more likely to affect your industry. Effect on industry growth Positive/negative Environmental factor Technological Factor Web for business transactions Technology for your products Technology for you process Genetic engineering Voice recognition computing Fibre-optics Electronic communications Composite materials Nanotechnology Comments Example: increased ecommerce. Page 1 of 4 Strategic Planning Template Macro Environment Analysis Whatmakesagoodleader.com Environmental factor Economic Factors Personal income rate Disposable income Average household debit Personal saving rate Unemployment rate Inflation rates Interest rates Exchange...
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...Impact of Macro Changes on Managerial Decisions Jones International University MBA502: Economic Theory and Applications Ciera Comstock Table of Contents [ No table of contents entries found. ] Macro-Environment Macro Environment is known as a company and all of the other actors operating in a large macro environment of forces that shape opportunities and pose threats to the company. There are major external and uncontrollable factors that influence an organization’s decision making and affect its performances and strategies. These factors include the economic, demographics, legal, political, social conditions, technological changes, and natural forces are known as the macro environment. (Johnston, 2014) Macroeconomics is intertwined with business because it is affected by all of the factors that constitutes macroeconomics. Macroeconomic is a branch of the economy that deals with certain issues that are relating to factors that affect the economy of the country as a whole. These factors include areas like the rate of unemployment, inflation, business cycles and also Gross Domestic Product (GDP). This is a big section to keep in mind when making a decision and is part of the marketing analysis. (wiseGEEK, n.d.) This environment could impact competitors, changes in interest rates, changes in cultural tastes, and also any change in government regulations. That influences a company and its’ products development. It will also change the competitors, the interest rates...
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...Objective of the Assay: Impact of Macro environment forces on the components of the core marketing system. I have defined some objectives in this assay: • To define Macro Environment. • Classification of Marketing Environment • Elements of macro environment • Impact of macro environment on marketing system. Macro- Environment: A factor that influence a company's or product's development but that is outside of the company's control is known as macro environment. The company and all of the other actors operate in a large macro environment of forces that shape opportunities and pose threats to the company is known as macro environment. Six largely uncountable external forces influence an organization’s marketing activities and shape opportunities is known as macro environment Forces. These factors include the economic, demographics, legal, political, and social conditions, technological changes, and natural forces are known as macro environment. Elements of Micro-Environment: Demographic Environment Demography is the study of human populations in terms of size, destiny, location, age, gender race, occupation and other statistics. The demographic environment is of major interest to marketers because it involves people. Economic Environment Marketers require buying power as well as people. The economic environment consists of factors that affect consumers’ purchasing power and spending power/ patterns. Marketers...
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...A PEST analysis is an analysis of the external macro-environment that affects all firms. P.E.S.T. is an acronym for the Political, Economic, Social, and Technological factors of the external macro-environment. Such external factors usually are beyond the firm's control and sometimes present themselves as threats. For this reason, some say that "pest" is an appropriate term for these factors. However, changes in the external environment also create new opportunities and the letters sometimes are rearranged to construct the more optimistic term of STEP analysis. Many macro-environmental factors are country-specific and a PEST analysis will need to be performed for all countries of interest. The following are examples of some of the factors that might be considered in a PEST analysis. It is very important that an organization considers its environment before beginning the marketing process. In fact, environmental analysis should be continuous and feed all aspects of planning. The organization's marketing environment is made up from: 1. The internal environment e.g. staff (or internal customers), office technology, wages and finance, etc. 2. The micro-environment e.g. our external customers, agents and distributors, suppliers, our competitors, etc. 3. The macro-environment e.g. Political (and legal) forces, Economic forces, Sociocultural forces, and Technological forces. These are known as PEST factors. Political Factors The political arena has a huge influence upon the...
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... Student ID: 12449 INTRODUCTION: That assignment consists of two parts. In first part, we will discuss the macro environmental factors that will affect BP (British Petroleum), when they have to consider their future strategic decision in order to regain their market position in the USA. In second part, we will suggest a marketing plan for BP to consider to recover from this ‘‘marketing disaster’’. The disaster is the Gulf of Mexico oil platform (which is the Deepwater Horizon) explosion occurred, millions barrels of oil have been leaked in the region for a few months. That infiltration is the largest environmental disaster in U.S. history. The goal of macro environment analyse is to see that marketing opportunity and threats were given by changes and trends in macro environment. Focusing on them for marketers helps to take decision and modifies their strategies and plans. The marketers wish to know which elements of macro environment affect their planning and how they influence future strategies. We will see the strong point and factors of macro environment which are the social and cultural environment, political and legal environment, economic environment, technology environment and demographic environment. And we will consider the “how these factors influence the decisions.” That assignment begins with the definition of the company which is BP. The company is active in the field of fuel all...
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...How the 6 macro-environmental forces may affect the marketing of Coca-Cola in 2012. Understanding the needs of the customers is the most important but the marketers should also be aware of the factors and the forces that influence the needs of the costumers. Some of the factors are the demographic, the economic, the sociocultural, the technological, the natural and the political forces, which are known as macro-environmental forces. Coca Cola is the world’s largest company with more than 3000 beverage drinks and with operations all over the world. Even if it’s a really successful company the last years has been influenced a lot from the macro- environmental forces. First of all, one of the most important forces is the economic one, which affects all the companies, just like Coca Cola because of the economic crisis that we have the last four years. The slowdown in the economy has as a result, high unemployment rate that can affect the population’s purchasing power. Some years ago the people consumed more products of Coca Cola but since the economic problem started the people try to decrease their purchases. However, in order to keep its costumers the company has decreased the prose of the product. Technology is another aspect of the macro-environment that has affected Coca Cola. The envelopment of the company depends on the technology they use that it helps them to bring more money than they expect. Coca Cola’s team decided to upgrade the SAP application in order to save money...
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...Huayi Yu China’s House Price: Affected by Economic Fundamentals or Real Estate Policy? © Higher Education Press and Springer-Verlag 2010 Abstract Many theory and empirical literature conclude that house price can reflect economic fundamentals in the long-term. However, by using China’s panel data of 35 main cities stretching from 1998 to 2007, we find that there is no stable relationship between house price and economic fundamentals. House price has deviated upward from the economic fundamentals since government started macro-control of the real estate market. We consider that the mechanism between the house price and economic fundamentals is distorted by China’s real estate policy, especially its land policy. Meanwhile the policy itself is an important factor in explaining the changes of China’s house price. Then we estimate the dynamic panel data model on house price and the variables which are controlled by real estate policy. The result shows: land supply has negative effects on house price; financial mortgages for real estate have positive effects on house price; and the area of housing sold and the area of vacant housing, which reflects the supply and demand of the housing market, has negative effects on house price. We also find some differences in house price influence factor between eastern and mid-western cities. Finally, we propose policy suggestions according to the empirical results. Keywords house price, economic fundamental, real estate policy, dynamic panel...
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...Macro Environment Analysis Definition Macro environment analysis is a review of all the factors that a company is unable to control. Companies conduct this analysis to stay aware of the issue in the current business environment. A common tool for conducting a macro environment analysis is the PESTEL framework, which include factors from the political, economic, social, technological, environmental and legal aspects in the business environment. The ultimate purpose of this analysis is to create a strategy that will leverage as many of these external factors as possible to the company’s favor. The political factors of the PESTEL analysis include the current stability of the government, social welfare policies imposed upon companies, trade tariffs or regulations that restrict international business and tax policies on corporate profits. This information is quite important to businesses, as extremely difficult political situations often result in lower profits and a more inflexible business environment. A macro environment analysis may focus heavily on the political factors in countries with difficult business environments. The group of external factors for this analysis comes from the economic factors within a country. Companies are unable to control issues like the income of buyers in the market, available credit offered by banks, unemployment, interest rates and inflation found in the economic market. These factors can also affect the company, lowering purchasing power...
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...F.Y.B.A. Paper – I Economic Theory (Micro Economics-I) SECTION – I Module 1 : Introduction Meaning, nature, scope, significance and limitations of micro economics. Ceteris Paribus – use and significance. Concept and types of equilibrium : stable, unstable, static and dynamic equilibrium – partial equilibrium and general equilibrium, positive economics and normative economics, managerial economics. Basic concepts – wealth, welfare and scarcity. Basic tools of economics analysis (equations and functions, graphs and diagrams, slope and intercepts) Module 2 : Consumers Behaviour and Demand Marishallian Approach : Equi-marginal utility, Law of demand – Determinants of demand. Elasticity of demand and its measurement. Price – Income – Cross and Promotional elasticity of demand. Consumer’s Surplus. Hicksian Approach : Indifference curves – properties of Indifference Curve, Consumer’s Equilibrium, Price effect, Income effect and substitution effect – Derivation of demand from Price Consumption Curve (PCC) – Giffen’s paradox. Samuelson Approach : Revealed Preference Theory. Module 3 : Production and Cost Analysis Concept of production function : short run and long run – Cobb – Douglass production function. isoquants – iso-cost line – producer’s equilibrium. Law of variable proportion and Law of returns to scale – Economies of scale – Economies of scope. Concepts of costs : Money and real cost, Opportunity cost, Social cost, Private cost – Derivation of short run and long run cost curves–...
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...Zoom In Zoom Out Page 1 of 2 Business Management Essay COMPANY: Starbucks Subject; “Discuss the impact macro factors may place upon your chosen organisation in the future (1-5 years) and how the organisation may positively manage this”. When speak from macro and micro perspective we must bear in mind that these are two different phenomenon’s. Micro factors can be described as factors that people and businesses keep in mind when making decisions concerning the allocation of resources, whereas macro factors can be described as the factors that are kept in mind when making decisions regarding not only specific companies but industries as a whole and economies, more over micro environmental factors are the one’s over which the business has control for example price, product and promotion whereas macro environmental factors are the one’s over which the business has no control as such as social, cultural, technological and political factors. Businesses operate in markets keeping in mind changing situations not only of their market conditions but also the trends of the economies that they operate in, so that they can adjust and survive in accordance with new situations because adaptation is a must for a business to survive and prosper otherwise a business might be forced to cease operations and shut down. Starbucks is one of top five(Caribou coffee, Tully’s ,Coffee bean and tea leaf, Peet’s Coffee) businesses in a $11 billion industry. The coffee house industry grew from merely...
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