...Demand and Supply Models Raquel Hernandez Adrian Diaz Maritza Medrano Lizette Estrada University of Phoenix Principles of Macroeconomics ECO/372 Mr. Daniel Rowe February 22, 2014 Economic Critique Aggregate demand and supply are two extremely important elements that must take into consideration in macroeconomics. Considering how numerous economic factors impact demand and supply which is very serious especially important to the government because during the time frame it determines the economic policy. Factors such as unemployment, expectations, consumer income, and interest rates include an interest on the aggregate demand and supply. Therefore, these factors will be explained from two perspectives which are the Classical and the Keynesian. Although the events of the past six years have undeniably left their mark on the supply side of the economy, the primary reason unemployment remains high is lack of demand (Williams, 2013, p. 1). The private labor force support rate was dropped by 0.2% and marked a 62.8% by December, balancing a transformation of the same degree in November of 2013. However, during December the employment population rate was constant at 58.6%. The private labor force support rate had weakened by 0.8%, during the year, although the employment population rate was constant. Economists attempt to explain or translate the information calmly to improve and determine what approach the government policy must force. The United Sates unemployment...
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...Supply chain and demand models ECO/372 August 25, 2014 Supply chain and demand models Supply chain is a system that consists of people, businesses, activities, information, and all the resources that involved in moving products or services from suppliers to customers. The supply chain is greatly affected by supply and demand. As the demand increases for a product this benefits all of the aspects of the supply chain and creates jobs and should reduce the cost to manufacture. Many assume that supply chain and the supply and demand model are one in the same or very similar. This is not the case at all they need to be at the forefront together when it comes to running a successful business they are not one in the same. They have to run hand in hand and be a complete balance of each other to run efficiently. The supply chain transforms materials and resources from a raw ingredient into a finished product that is eventually disbursed to the customer. The supply and demand model affects this in regards to what is currently driving the supply chains market. As demand raises and lowers the supply chain has to be efficient in keeping up with the market or it could find itself in severe trouble with excess product and no clientele or no enough product and excess supply. In the Supply chain system, products can be re-entered the supply chain for recycling again. The relationship between supply and demand is an inverse relationship. When demand increases from consumers, supply decreases...
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...Supply Chain and Demand Model Valerie Prich ECO/372 April 20, 2015 Matthew Angner Supply Chain and Demand Model The relationship between a supply chain and a supply and demand model is an important one. Without this relationship, business would not be able to be as organized with their business. Along with this, the businesses would also not be able to distribute their products to the consumers. The consumers who purchase the products do not realize all of the steps that come with this relationship. There needs to be an understanding of both the supply chain and the supply and demand model. Supply Chain Supply chain is the beginning of a business production. A business must have a supply chain in order to be able to receive products and to distribute them. The definition of supply chain is described as a certain network of other companies that works together to both serve the customer, and the consumer (Supply Chain, 2015). A supply chain is the main link between a business and its consumers. When a consumer purchases a product from a business it comes from a line of other companies. The product might come from one store that manufactures the product, then is sold to another store for a goods price, next it is sold to the customer at the price they are willing to pay. Supply chains are not always used to their full extent. Many companies are unaware of what really goes on within their supply chain. There are businesses that do not know the information flow of the supply...
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...Learning Team Reflection: Supply Chain and Demand Model ECO/372 Learning Team Reflection: Supply Chain and Demand Model The topic that we are discussing is supply chain and demand model. We have learned many valuable tools over the past four weeks that has lead us to this topic. We learned about historical economic data, economic forecast data, aggregate demand and supply models. Each of these topics has aided us in learning the fundamentals of Macroeconomics. This week we discussed the relationship between supply chain and the supply and demand mode. We will explain what each is and how they work together. Our goal is to gain and give a better understanding of the relationship between the two. Supply Chain and Demand Model A Supply Chain is a network of companies and services that have products available to consumers. “Historically, the three fundamental stages of the supply chain; procurement, production and distribution, have been managed independently” (Thomas & Griffin, 1996, p. 1). The supply chain gets a good or service from the supplier to the consumer. Goods are often produced anywhere in the world, and the supply chain management makes them available to us locally so we don’t have to travel far to purchase a foreign car, a pair of jeans or a cup of coffee. They make sure we get the best quality for the price we pay. The supply chain consists of purchasing, logistics and the production line. The supply chain exists to bring in the...
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...Aggregate Demand and Supply Models Team B ECO/372 March 26, 2015 Aggregate Demand and Supply Models Many factors within a nation’s economy have the ability to effect one-said nation’s aggregate supply and aggregate demand models. Of these factors, four will be explored through the course of this specific critique and it should be noted, that the specific nation to be observed is the United States of America. The specific factors to be observed in the United States’ economy are their unemployment, their expectations, consumer income, and interest rates. In addition to identifying these four factors and their economic effects, there will be identified what fiscal policies have been put in place by the United States government in order to aid the economy and finally, there will be an evaluation of these fiscal policies regarding their effectiveness from both a Keynesian economic perspective and that of a classical economist. Unemployment A nation’s unemployment rate, as can be expected, is calculated by dividing the total sum unemployed persons by the number of total persons available for within the nation. This formula yields the number that is considered the unemployment rate for whichever nation is in question, in this case though, the nation that is the focus of our investigation is the United States. According to the Bureau of Labor and Statistics website (2015), “the unemployment situation in the United States has been reduced to 5.5 percent. This decrease as reported...
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...Aggregate Demand and Supply Models Unemployment Rate in the United States is reported by the U.S. Bureau of Labor Statistics. According to Fedec, the unemployment Rate in the United States increased to 6.20 percent in July of 2014 from 6.10 percent in June of 2014. The U.S. jobless rate increased to 6.2 percent from 6.1 percent in June as more people entered the labor force. Wages and hours were unchanged from the previous month. The rate has declined over the past 12 months by 1.1%. The number of long-term unemployed people (27 or more weeks) did not change at 3.2 million in July. 32% of the unemployed were long-term unemployed. The number of people forced to work part-time was 7.5 million and unchanged. Many of these part-time were doing so because their job cut back hours or they simply could not find full-time work. Unemployment causes consumers to have less money and therefore there is less demand in the economy. The aggregate demand curve shifts to the left. Unemployment also reduces the amount of labor in the workforce and this shifts the aggregate supply curve to the left. A decrease in one of the determinants of aggregate supply shifts the curve to the left. Some examples of a decrease would be output falls below the natural rate of employment, unemployment rises, the price level rises, or stagflation happens. Fiscal policy attempts to mitigate unemployment and stabilize the economy. Tax cuts and increased spending are used in an attempt to fight unemployment...
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...Aggregate Demand and Supply Models ECO/372 Aggregate Demand and Supply Models The following report will detail out the current state of the U.S. Economy. The report will discuss the following: * Current economic state in regards to unemployment, expectations, consumer income and interest rates * The existing effect of the economic factors on aggregate demand and supply * Fiscal policies that are currently being recommended by government leadership * The effectiveness of those fiscal policy recommendations from the Keynesian and Classical model perspectives. Unemployment rates fluctuate when the supply and demand for human resources are out of balance. The supply and demand are a result of the interaction of economic, policy and structural factors. Economic factors affect both supply and demand. The demand for goods and services increases production which results in the demand for workers, increasing the employment rate. The common thought among economists is that market-driven economies move in cycles and when they drop below certain levels unemployment may result. The moving of production from high wage countries to low wage countries is another factor that increases unemployment. A declining manufacturing sector will result in not enough jobs to go around along with third world competition. While new jobs are being created in the technology and service sectors it is not enough to make up for the amount of jobs that have been lost due to moving...
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...Aggregate Demand and Supply Models Renee Chaplin, Angel Cole, Tamara Northern, Katrina Schreiber, Ryan Shaw ECO/372 November 3, 2014 Alexander Heil Aggregate Demand and Supply Models In order to have a strong economy, you have to have certain elements to keep the U. S. economy going. This paper will discuss four different elements that affect our U. S. economy today. Those four elements are unemployment, expectations, consumer income, and interest rates. The unemployment rate in the United States last week according to Trading Economics was 5.9, where as the highest it has ever been was 10.80, and 7.2 last year this time. (Trading Economics, 2014) Although these numbers sound good that is still a lot of people and every person out of work is hurting the economy. The longer a person is out of work the harder it is for them to find employment. “Unemployment negatively impacts the federal government’s ability to generate income and also tends to reduce economic activity.” (Hamel & Media, 2014) The higher the unemployment rate the more effect it has on aggregate demand and supply. If millions of people are out of work then they are apt to spend less money therefore there is less of a demand for the supply, which in the long run continues the ill effects on the economy. Fiscal Policies are how the government tries to make amends to the economy in times of hardship. The government can lower taxes or offer public work programs to lessen the effect on the unemployed. This...
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...Discuss the relationship between supply chain and the supply and demand model. Over the past four weeks we have learned many important lesions and gained many tools to help us in all of our future endeavors. Some of the things that we have learned about are, aggregate demand and aggregate supply models, economic forecast data, historical economic data, interest rates, money supply, and the Federal Reserve. These topics are key in understanding the concepts of the fundamentals of macroeconomics. This week’s learning team reflection will discuss the topic of the supply chain and its relationship to the supply and demand model. This paper will explain and discuss each of the topics and how they relate to each other and how they work together. The objective of this paper is to help give the readers an improved understanding of the two concepts and their relationship. Supply Chain and Demand Model A Supply Chain is a network of companies and services that have products available to consumers. “Historically, the three fundamental stages of the supply chain; procurement, production and distribution, have been managed independently” (Thomas & Griffin, 1996, p. 1). The supply chain gets a good or service from the supplier to the consumer. Goods are often produced anywhere in the world, and the supply chain management makes them available to us locally so we don’t have to travel far to purchase a foreign car, a pair of jeans or a cup of coffee. They make sure we...
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...AGGREGATE DEMAND SUPPLY MODELS: ECONOMIC CRITIQUE Although unemployment rates have improved in the last three years, the unemployment rates are slowly beginning to rise again. Millions of Americans are still out of work. Acquisitions, company closings, and massive layoffs, among other factors, are contributors to the ongoing issue. Employers in 20 states, which are almost half of the United States, have cut jobs. The unemployment rate increased in 18 states, decreased in 17 states, and did not change in 15 states (Newsmax Media Inc, 2013). Most Americans expect the government to solve economic issues. Unemployment, expectations, consumer income, and interest rates have an existing effect of the economic factors on aggregate demand and supply. When unemployment rates are high, households have less money to spend. If there is less money in a household, people will need to budget and focus on the necessities. Consumer income affects the economy because it reduces the amount of money spent in other areas, such as entertainment, sports, and dining. The less money people have, the less demand there is. Unemployment reduces the supply demand and labor demands. Companies downsize and lay off employees to save money that reduces the excess of supplies. Unfortunately, this reduces jobs and causes the economy to fall. To shift the decline in the economy, there needs to be a demand to make supplies and products. Interest rates, taxes, inflation, and regulating the cost of...
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...Aggregate Demand and Supply Models Introduction Social, technological and political changes in the US and around the world affect the U.S. economy today. Even if the U.S. economy presently remains as one of the world’s largest economy, the country is now in deep recession and must The purpose of this paper is to understand the prevailing economic trends in the US particularly on unemployment, interest rates, and consumer income including the expectations of both the consumer and business sectors. This paper will also discuss the effect of these economic indicators on the aggregate supply and demand and the evaluation of current fiscal policies that were recommended by the government. This paper aims to let future business managers be aware of the importance of comprehending current US fiscal policies as it outlines the blueprint of change to the US economy. Current Economic Trends Unemployment is a term that you will hear often when spending time in any city in the United States. It is an issue that is spoken of from the dinner table to the oval office. The United States experienced its “worst downturn since the Great Depression” but continues to recover adding 176,000 jobs to the private sector in March-April 2013 and reducing unemployment to 7.5% (Bureau of Labor Statistics, 2013). President Barack Obama has introduced large plans to reform banking in America. The people of the U.S. expect to see banks become more regulated, they expect that home loans will be reasonable...
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...Aggregate Supply & Demand Models Marie Diaz ECO/372 9/11/14 John Smith The United States has fluctuating economic system. Many factors contribute to the current state of the economic factors unemployment, expectation, consumer income, and interest rates. The following is an analysis of how each factor is performing at the present moment and how each of these factors are connected and can effect each other in determining what decisions need to be made for the U.S. government going forward. Unemployment Fiscal policy plays an important role with unemployment. The current economic model is one in which " unemployment can arise, but can be mitigated by tax cuts and public spending increases" (Princeton University, 2014). The problem with this method is that it is financed with government debt and can be fiscally costly in the long run. In terms of model perspective, the Keynesian and Classical models differ in their treatment of unemployment. The Keynesian model views unemployment as the normal state because it is part of the business cycle. It holds that the government must get involved to change the situation. AS is horizontal, and government intervention may be required to reach target outputs. Current fiscal policies to improve this type of unemployment are deficit spending and monetary policy. The Classical theory, on the other hand, treats unemployment differently. It seems full unemployment as the norm and as the level it will return to long...
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...Supply Chain vs. Supply and Demand Model ECO372 Supply Chain vs. Supply and Demand Model In today's competitive economic industries, companies are taking strategic steps to solidify a stern supply chain to ensure overall growth in target markets. Companies must have products readily available in order to stay in business and to stay relevant amongst consumers. In the world where millions of consumers are making choices and control what they want to purchase and how often they want to do so strikes a need for more resources and productivity. Businesses are constantly evolving in an effort to become the leader in their industry to attract and appeal to as many people possible. Supply and demand are the key elements in establishing the ultimate value of a consumer product. There are several influential factors that can alter the demand and create changes in production by increasing or decreasing the overall supply. Seasons, trends, advertising and availability all provide a platform for business to act on the need of the consumer market. Supply Chain "A supply chain consists of all parties involved, directly or indirectly, in fulfilling a customer request. The supply chain not only includes the manufacturer and suppliers, but also transporters, warehouses, retailers, and customers themselves. Within each organization, such as manufacturer, the supply chain includes all functions involved in receiving and filling a customer request. These services include, but are not...
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...Unemployment To be unemployed means there is a low to zero income coming in which makes the economy to have less demand. Because of the less demand, aggregate demand curve shifts to the left, and if unemployment reduces supply of labor in economy, the aggregate supply curve shifts to the left. This could only happen if the unemployed loses hope of finding a job and gets discouraged looking for one. Some economists argue that the best way for the economy to not get stuck in a recessionary gap is for the government to play a role in managing it. A major way government can be influential to the economy is through its fiscal policy. This means, there will be changes in government such as, low unemployment, price stability, and economic growth. If the Real GDP in the economy turns down, that will cause more people to be unemployed and this will result in automatically receiving unemployed benefits and these unemployment benefits will naturally boost government spending. Keynesians are likely to propose a decrease in government purchase and increases in taxes to shift the Aggregate Demand from the left. Expectations We live in an era where an enormous amount of information is easily and readily shared by more persons than ever before. However large the quantity, the overall credibility and quality of the shared information is at best, given in the form of opinion or from very shaky ground. Included in this vast ocean of opinion-laden information are the variety of viewpoints...
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...ECO 372 Principles of Macroeconomics Week Three Team Assignment Aggregate Demand and Supply Models Linette Pugh, Jyenna Baeza University of Phoenix Online Professor: Leo Stevens Unemployment The United States is recovering from a recession and high unemployment numbers. As of December 2013 the Bureau of Labor statistics reported that unemployment is down 6.7% from 7%. The number of unemployed persons declined by 490,000 to 10.4 million in December, and the unemployment rate declined by 0.3 percentage point to 6.7 percent. 2013 reported 11 million Americans out of work and 4.4 million people who have been unemployed for six months or longer. Over the year, the number of unemployed persons and the unemployment rate were down by 1.9 million and 1.2 percentage points, respectively ("The Employment Situation 2013", n.a). Michigan and Indiana are the two states that are reporting the highest unemployment which are 8.5% and 8.7% ("Important Unemployment Figures", 2013). While the numbers are starting to decline, unemployment is on the minds of many Americans. Since the future is so unsecure people are saving instead of spending, they are preparing for that day in case it comes. Demand starts to go down and the aggregate demand curve shifts to the left. President Obama realizes that incentives need to be made to help our economy prosper. On April 5, 2012, the president signed a bill called the (JOBS) Act. This bill allows starters to raise capital more quickly from...
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