...indicators that are important to consider when talking about Canadian economy. These are employment, unemployment, composite leading index, housing starts, consumer price index, real gross domestic product, retail sales volume, merchandise exports, and merchandise imports. (Statistics Canada, 2011) Employment and Unemployment In November 2011 the unemployment rate was set at 7.4%. The average unemployment rate in Canada from 1976 to 2010 was 8.53. (Trading Economics, 2011)The employment force is the number of people employed plus the number of people looking for employment. (Trading Economics, 2011) Unemployment includes those not looking for work, people in the military, and people institutionalized. (Trading Economics, 2011) Canada was able to add 93,000 jobs in June 2011, in effect dropped the unemployment rate to below the 8% mark. The gains in the labour force will offset nearly all of the losses that were a result of the downturn in 2008. (Contenta, 2010) This shows that Canada is on track for economic growth and stability. Composite Leading Index In November Canada’s composite leading index increased by 0.8%. (Kolet, 2011) This has been the largest increase in five months. (Kolet, 2011) The composite index is comprised of ten components and used to predict what will happen in the future economy. The rise in the index shows...
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...Exam 3 Spring 2013 Question 1. 1. In the market structure called monopolistic competition (Points : 1) | a. Very little advertising will occur b. There are only a few companies in t he industry c. These industries offer only few products X d. None of the above | | Question 2. 2. In a purely competitive industry (Points : 1) | a. Products are differentiated b. A large amount of advertising occurs c. Price will be higher than in other market structure X d. None of the above | Question 3. 3. A used lawn mower is an example of (Points : 1) | a. a search good X b. an experience good c. a homogenous good d. None of the above | Question 4. 4. The problem of asymmetric information can be overcomed by (Points : 1) | a. Reputation b. Brand name c. Warranties X d. All of the above e. None of the above | Question 5. 5. The CAPM can be used to: (Points : 1) | a. Determine a company's cost of using bonds to raise capital b. Estimate the rish premium a company must pay to raise money by issuing stocks c. Shows the relation between risk and return for stocks in thewhole market d. Can not be used to determine a company's cost of issuing stocks X e. b and c | Question 6. 6. Given TC=10+5Q, ED=-2, what price will a monopolist charge? (Points : 1) | a. 5 b...
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...COURSE: MANAGERIAL ECONOMICS: COH 723 Programme; MSc Health Services planning and Management Department; Community Health Lecturer; J Kwaku Agyemang 1. Course Description Managerial Economics is concerned with resources allocation, decisions that are made by managers in both private and public sections (private business, private NGO’s and public sector) of the economy. The course emphasizes the application of economic principles and methodologies to decision-making process of business firms operating under conditions of risk and uncertainty. Managerial Economics, thus, uses concepts, models and analytical techniques of economics to study and analyse the operations of businesses and the type of problems managers face. Hence it provides important conceptual insights for gaining a better understanding of business environment and for making of quality business decisions with minimal trial and errors. 2. Objectives: 2.1 To provide participants with a much clearer view of the applicability and relevance of economics to decision making within business firms. 2.2 To develop students’ knowledge of applied economics 2.3 To develop students’ analytical skills to a higher level. 2.4 To enhance students’ insight into the operation of business and the nature of problems managers face. 3. Course coverage * Introduction of students to Managerial Economics and the use of models and other analytical concepts in decision making process...
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...Unemployment Unemployment Rate in Uruguay decreased to 5.70 percent in July of 2014 from 6.90 percent in June of 2014. Unemployment Rate in Uruguay averaged 7.55 Percent from 2006 until 2014, reaching an all time high of 13.40 Percent in January of 2006 and a record low of 5.40 Percent in December of 2010.(www.tradingeconomics.com) The forcast for unemployment is at six and a half percent for the next year. This rate has economists concerned now, due to lack of skilled workers, and workers in general. The median age, in Uraguay, are older and this has meant a lower birth rate. Lower birth rate means, less people to employ for certain jobs in Uraguay. Since 2002 there has been a steady economic growth rate. A report stated that “sustained economic growth over the last few years, and increase in foreign investment and in agriculture and forestry has created many new jobs and now it is hard to satisfy the demand for adequately skilled workers”. (www.en.mercopress.com) A new pulp mill and mining are expecting to need approximately 10,000 new workers. As a solution to this problem incentives are being offered to Uruguayans living abroad to return to their country and join in the construction boom and industry work. Even with low rates in unemployment it seems to have a reverse effect on the economy to attain the number of workers once a shortage of work has now become a shortage of workers. The government has now reached out to women and the young for training of basic skills...
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...exports and capital spending in favor of consumption. In face of global turbulence and a pressing domestic demand for economic restructuring, China forecast a slightly lower GDP growth rate to achieve "higher-level, higher-quality development over a long period of time." To achieve steady growth, the government will continue to expand domestic demand and keep foreign demand stable, vigorously develop the real economic, so as to counter instability and uncertainty at home and abroad. In my view, there are two possible reasons for Chinese Government forcast to cut 2012 GDP growth at 7.5%. The first reason is to comply with the need of international economic situation and domestic population structure change. Since China joined the WTO in 2001, China economic growth at double-digital in many years, it is benefit from rapid global economic growth provide the overseas market demand pull. However, with the outbreak of the 2008 global financial crisis and the ensuing sovereign debt crisis in the United States and Europe, the global economic growth in a black outlook, the overall recovery of economic in developed countries will be a slowly and long process. It will affected China economic. In expanding United States and Europe export market, adjustment of the foreign trade structure and improving the quality of trade. At the same time, China have to adjust the economic growth pattern, more excavating domestic demand, this is obviously can not achieve in short term. Otherwise, the "demographic...
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...ECONOMIC AND FINANCIAL MARKET OUTLOOK September 2015 Balancing Act: Pendulum swings toward US economy supporting global growth Global GDP growth Annual % change 8 Forecast 7 Emerging 6 5 4 World 3 Advanced 2 1 2010 2011 2012 2013 2014 2015 2016 Source: International Monetary Fund, RBC Economics Research The outlook for the global economy was muddied over the summer as the emerging market economies, led by China, weakened. Conversely, in many advanced economies, growth accelerated led by a robust increase in the US, a solid gain in the Euro area and rebound in the UK. Canada’s economy put in another weak performance in the second quarter although the monthly data augur well for a return to positive growth. On balance, the softening in the emerging market economies created downside risk to the world economy being able to maintain the 3.4% growth rate recorded over the prior three years. That said, the forecast was premised on activity in the advanced economies picking up sufficiently to offset a slowing in the emerging market growth and this appears to be playing out. China’s slowdown creates anxiety Market Volatility Index (VIX) Index 45 40 35 30 25 20 15 10 5 2013 2014 2015 Increased anxiety about China’s economy and the stability of its financial markets fuelled concerns about global growth and international trade. Reports of weakening domestic demand and export activity elicited...
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...Norwegian Air Shuttle Analysis of Global Expansion Strategy through subsidiaries in emerging economies Consultant Report 16 October 2013 Presented to: Dr. Kent Springdal The International Business Environment Table of Contents EXECUTIVE SUMMARY ................................................................................................................................. 3 COMPANY PROFILE ....................................................................................................................................... 3 MARKET ANALYSIS........................................................................................................................................ 3 GLOBAL ................................................................................................................................................................ 3 CORE MATURE MARKETS .................................................................................................................................................... 4 EMERGING MARKETS ........................................................................................................................................................... 4 CONSUMER DEMAND............................................................................................................................................................ 5 COMPETITION ............................................................................................
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...MRC 1513 ECONOMIC ANALYSIS WORKSHOP 1A Question 1: Although managerial economics is based primarily on microeconomics, explain why it is also important for managers to understand macroeconomics. Answer: Felda Technoplant Sdn Bhd is a subsidiary of Felda Holdings Berhad and was established on 22 June 2005 as a management agency for FELDA settler plantations. Among its main activities is replanting estates, managing immature and mature plantations as well as providing oil palm planting materials for estate replanting purposes. Almost 90% of the replanting area is planted with oil palm and the remaining planted with rubber. Thus we are subject to risks inherent to the plantation industry. These include damage from pests, outbreak of diseases such as ganoderma, fire or natural disasters, unscheduled interruption in palm oil milling and rubber tapping operation, climate condition, downturns in the global, regional and national economies, changes in law and tax regulations affecting palm oil and rubber and the competitive needs of labour with other industry. Movement of commodity price in local and international market influence the price of Fresh Fruit Bunch (FFB) and rubber. This will affect managerial decision whether continuing the normal field operations or take certain mitigation action focusing only to harvesting work while other work activities such weeding and fertilizing being stop until the operational cost becomes more viable. As an example, in 2008 the FFB selling...
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...Set 105 Environmental Scanning/Industry Analysis – 1 1. What external environmental variables should be scanned? In conducting an external environmental scan, focus should be drawn to two environmental variables: • Societal environment (macro-environment) – This is the general environment in which the business organization operates. It is characterized by those variables on which the business has no control. It does not directly touch on the short run activities of the firm but can, and often do influence its long-run decisions. • Task environment (micro-environment) – This is the industry within which the business organization operates. This environment is characterized by various players and stakeholders who affect a business enterprise, and are also affected by it. 2. According to Porter, what determines the level of competitive intensity in an industry? According to Porter, the level of competitive intensity is determined by 5 basic competitive forces namely: (1) Threat of new entrants to a market (2) Bargaining power of suppliers (3) Bargaining power of customers or buyers (4) Threat of substitute products and (5) Degree of competitive rivalry 3. What should be scanned in the task environment? There should be an analysis of relevant elements in the task environment such as: (1) Competitors (2) Suppliers (3) Regulators (4) Strategic Partners (5) Labor and (6) Customers. 4. Discuss how a development in a corporation’s societal environment can...
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...An Assignment on Money Market and Labour Market in context of Bangladesh Course Instructor: Abdul Jalil Chowdhury SUBMITTED BY: Zinat Mahal Roll No.: 1328 Departmental of Training for BCS (Economic) cadre Officers NAPD, Ministry of Planning, Nilkhet, Dhaka-1205 Introduction Bangladesh is a developing country in where money market and labour market are two of the most important issues of economics that determine long run development of a country. The GDP and infrastructural development of a country depend largely on the successful and efficient money market and labour market. Financial sector is considered to be playing a crucial role in facilitating efficient allocation of resources and improving productivity of investment. Although the direct effect of financial institutions on the real economy is less clear, the indirect impact of financial market is essentially critical (Herring et al., 1991). Mobilization of savings, managing risks and facilitating exchange of goods and services are the functions of financial sector that connect households, firms and governments for their own purposes. An efficient financial system can be of great use for the poor through boosting the growth of the economy and reducing the financial risks by creating an enabling environment to ensure easy access to financial services for all. Money Market A segment of the financial market in which financial instruments with high liquidity and very short maturities are traded...
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...use of feedback, decision making and human relation etc. Miller (1983) defines entrepreneurship as a multidimensional concept encompassing a company’s action relating to innovation and risk taking and proactive measures.Innovation and risk-taking has an important place in entrepreneurship. Schumpeter (1994) described role of entrepreneurship as tendency of company to engage in and support new ideas, novelty, and experimentation that may result in new products, services. Risk taking describes the nature of entrepreneur. A.H. Cole has explained entrepreneurship as, “the purposeful activity of an individual or group of associated individuals, undertaken to initiate, maintain, or earn profit by production and distribution of economic goods and services. According to Heggins, “Entrepreneurship is meant the function of seeking investment and production opportunity, organize an enterprise to undertake a new production process, raising capital, hiring...
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...THE COST OF CAPITAL, CORPORATION FINANCE AND THE OF INVESTMIENT In the business world we make investment for two main reasons or either of them that can be for the maximization of our profite from a business or it can be for the maximaization of the market value of the assets. Businesses generally aquire the assets if the perceives that the particular asset can help in increasing the profit of the organisation. According to the theory the acquisition of the asset can help to increase the profit only if the returns arising due to that asset are more than the interest costs arising due to that asset. On the individual level when we are cosidering the purchase of any asset we should also consider the risk factor associated with that asset. Profit maximization and value maximization they both have more or less same meanings and implications. But if the case is of uncertainity then the profit maximization has no meanings, it remains meaningless for the investors. When the situation is uncertain then in that case the market value maximization becomes the basis for the theory of investment, if this notion is kept in mind then every time when we are going to make a decision to invest or not we should simply keep one thing in our mind that can be the basis of the decision, that is if we aquire the particular asset will it help to increase the value of the firm’s share? If in response of this question we comes on this point that yes it will result in increase in the value of the firm’s...
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...TEPAV – Economic Policy Research Foundation of Turkey The first company that we visited in Ankara was the Economic Policy Research Foundation of Turkey. There they presented to us the Turkish economic background, the actual economic position regarding European Union and Middle East and what are their challenges to keep the long-term competitiveness. Turkey is strategically located between Europe and Middle East and this advantage, after the policy reforms, made the country boost their economy by attracting companies that operates in both markets. The country is so well geographically located that we in a 3 hours flight you have an economic potential of 8,7 Trillions of dollars. The ground for this economic boom was the first generation reforms starting in 1980 with Price reforms and Trade and Financial liberalization. After that in 2001 they had the Banking reform, Privatized state owned companies, created Independent authorities to regulate the markets and they also adopted Fiscal and Monetary discipline. Nowadays, they are trying to move from an Efficiency-driven economy to an Innovation-driven economy, which means that they need to not only build or make goods in the country but also aggregate value to the goods produced. Investing in education is the only and long way to shift the economy from large scale transformation to high-tech. On the other hand, Turkey has a current account deficit and it is at historic high, it corresponds as 10% of GDP. The majority of the...
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...Monetary Policy Design in a DSGE Model 1. A simple model 1.1 Households The utility function of a representative household is ∞ ⎛ ξ C1−σ L1+η ⎞ Et ∑ β s ⎜ t + s t + s − t + s ⎟ 1+η ⎠ s =0 ⎝ 1−σ (1) The dynamics of the demand shock is ζ t = ζ t −1 + eζ ,t , where ξt = eζ . The consumption is t θ −1 ⎡ 1 ⎤ θ −1 composed of lots of goods. It is composed in a CES function Ct = ⎢ ∫ Ct (i ) θ di ⎥ . The i =0 ⎣ ⎦ 1 1−θ 1−θ consumer price index is P = ⎡ ∫ P (i ) di ⎤ . Then the demand function of each good is t t ⎢ i =0 ⎥ ⎣ ⎦ 1 θ ⎡ P (i ) ⎤ Ct (i ) = ⎢ t ⎥ Ct ⎣ Pt ⎦ The budget constraint is −θ PCt + Bt = Wt Lt + Π t + Rt −1 Bt −1 t The first order condition for Ct , Lt , and Bt are Ct−σ = λt Pt Lη = λtWt t λt = Rt λt +1|t After some calculation, we have the Euler equation and labor supply equation ξt +1Ct−+σ / Pt +1 1 β Rt Et =1 −σ ξt Ct / Pt ξt Ct−σ Pt 1.2 Firms (2) = Lη t Wt (3) Assume there is a type of price stickiness in the economy, that each firm has a probability φ that cannot change its price, and fixed the level as the last time. And it has a probability 1 − φ that can re-optimal its price. The problem of a firm which can re-optimal its price in time t is 1 Et ∑ (βφ ) s Λ t + s [ Pt* (i )Yt (i ) − Wt Lt (i )] s =0 ∞ ⎡ Pt * ⎤ s.t.Yt + s (i ) = ⎢ ⎥ Ct and Yt (i ) = At Lt (i ) ⎣ Pt + s ⎦ The dynamics of the technology shock is at = ρ a at −1 + ea ,t , where at = ln( At ) . The first order condition is ...
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...Financial Concepts in a Changing Business Michael Magons FIN/571 April 9, 2012 Beatrice Jones Financial Concepts in a Changing Business Guillermo Navalles’s furniture store is facing some new competition and has choices to make (University of Phoenix, 2012). These choices include competing with the new firm, absorbing or being absorbed by other firms, or changing from mainly manufacturing to distribution. Changing technologies and changes in the labor force influence decisions Guillermo needs to make to improve his business. Financial concepts associated with these types of changes are discussed here. Guillermo is compelled to make decisions about how he runs his company because of his own financial self-interest (Emery, Finnerty, & Stowe, 2007). The opportunity cost for Guillermo’s firm has changed since the arrival of new competition, and he must decide how to change his variable costs to maintain the prosperity of his company. His options include altering labor costs through automation or changing from a manufacturer to a distributor with more outsourcing (University of Phoenix, 2012). He is also displaying the behavioral principle because he is considering either copying the competition or adopting a business model that works for other furniture firms. Copying the behavior of another could work for Guillermo. The comparative advantage principle can also work with Guillermo because he can offer a patented coating that is flame retardant and...
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