Smythe Inn and Suites
Dyamond Nelson
ECO 121 September 2nd, 2011 Tim Randolph *
Smythe Inns and Suites * Due to the current state of the economy we are forced to layoff 25% of our labor force. In more realistic terms of the 783 employees that work for Smythe Inn & Suites 200 will be directly affected. This comes at a very unfortunate time, however we are optimistic that this is an obstacle that we can use to learn and grow. I would like to take this memo to give some history behind our decision to shift our labor costs, thereby hopefully giving a since of security in the new directs Smythe Inn & Suites has begun. * In 2009 the US economy saw major shifts in it financial sectors. There was the untimely demise of Lehman Brothers, the acquisition of Merrill Lynch by Bank of America, The failure of Freddie Mac & Fannie Mae, even the Bank Bail out and the saving of GMC, Ford, and Chrysler. All, were adverse impacts on our financial sectors. These changes had a large effect on the business cycle and the GDP both measures that companies and the government use as guides to assess the success of the economy. Are we in a recession? Expansion? All are answered by GDP & the business cycle. * In the introduction example, the collapse of these financial industries caused the business cycle to consider the state of the economy to be in a recession. To give a better picture of this analysis and how it comes about:
“A business cycle has four phases; expansion, peak, recession and trough. Each phase is of an undetermined length of time, varying from weeks to years. However when looking at historical data, the economy seems to move from one phase to another in a somewhat cyclical manner … GDP is a monetary measure of the economy’s production, valued using the prices from a selected base year… consumer