...Unit 3 Managing the economy Steve Margetts CONTENTS Aggregate Demand (AD) Aggregate Supply Equilibrium Between Aggregate Demand And Aggregate Supply Consumption And Savings Investment Government Spending Exports and Imports Objectives Of Government Macroeconomic Policy Inflation Unemployment Economic Growth Balance of Payments Conflicts Between Macro Economic Objectives Demand Management or Supply Side? 2 4 9 11 17 25 29 31 34 50 71 80 84 87 Page 1 Unit 3 Managing the economy Steve Margetts AGGREGATE DEMAND (AD) Aggregate demand (AD) is the total demand for goods and services produced in the economy over a period of time. DEFINING AGGREGATE DEMAND Aggregate planned expenditure for goods and services in the economy = C + I + G + (X-M) C Consumers' expenditure on goods and services: This includes demand for durables & non-durable goods. I Gross Domestic Fixed Capital Formation - i.e. investment spending by companies on capital goods. Investment also includes spending on working capital such as stocks of finished goods and work in progress. G General Government Final Consumption. i.e. Government spending on publicly provided goods and services including public and merit goods. Transfer payments in the form of social security benefits (pensions, jobseekers allowance etc.) are not included as they are not a payment to a factor of production for output produced. A substantial increase in government spending would be classified as an expansionary fiscal policy...
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...may be, for example, sales, availability of skilled labour or availability of materials that may be in short supply. In such circumstances, consideration should be given to maximising the contribution per unit of scarce resource consumed. Example 1: The following information is provided relating to the anticipated demand and the productive capacity for the next quarter in respect of three components that are manufactured within the department of Rhine Autos: Component X Component Y Component Z Contribution per unit €12 €10 €6 Machine hrs required Per unit of output 6 hours 2 hours 1 hour Est. sales demand 2,000 units 2,000 units 2,000 units Required machine hours for the qtr 12,000 hours 4,000 hours 2,000 hours Because of the breakdown of one of its special purpose machines capacity is limited to 12,000 machine hours for the period, and this is insufficient to meet total sales demand. You have been asked to advise on the mix of products that should be produced during the period. Example 2: Hugh Geraghty the Managing Director of MCG Ltd, has asked you for advice in relation to a matter that is of concern to the company. It has expected that during November 2011 there will be a market shortage of the skilled labour required to produce two of its most popular products the Alpha and the Beta. During the month November 2011 the direct labour hours available will be limited to 32,000 hours. The...
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...The basic of organizational behavior (OB) is how individual behave in an organization related to its work settings (McShane, Olekalns and Travaglione, 2013). In a shifting business environment, managing of workforce has been of huge concerned and OB has offered contributions in managing workforce over the years. Globally workforce is changing rapidly for reasons such as the labour force is growing older, workforce are becoming diverse, changers in workers attitudes and labour shortages (Weick and Quinn, 1999). As stated above one of the main causes of the changing workforce is the ageing population. As baby boomers are getting older and starting to retire, it is important that employers understand the needs and motivation of the younger generation (generation Y) who will soon be replacing the older generations (Anderson and Hussey, 2000). Moreover companies feel the need to recruits and retains younger workforce to replace an estimated amount of 75 millions of departing older workforce (Humphrey, Costigan and Pickering, 2003). The generation Y people are known to be disinterested and selfless about the welfare of others. In order to attract and retain them, companies have to be aware of their work values (Twenge and al, 2010). A consequence for the organization of this change is that older generations were fulfilling their job with the potential of a lasting relationship between the employee and the organization than the younger generations. The latter showed little interest...
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...1967. Geographical wage differentials in an industry: The case of cotton textiles in India.Indian Journal of Industrial Relations. Vol. 3, No. 1, p.p 3-18. T. S Papola in his research attempted to explain the wage differentials among textile workers in three towns namely Ahmedabad, Bombay and Kanpur. Economic variables namely observed the author used labour market, real wage levels, productivity, industry's characteristics, profitability as well as cost of living. Despite its shortcomings in terms of coverage and methodology, the author managed to come up with the findings by utilizing descriptive statistics. The conclusion made was that, the real wage levels was the significant determining factor of differentials. Hence, according to him, the wage differentials are bound to widen on the account that the each region's living standards likewise widens. However, he went further to explain that this factor may not solely explain in depth the existing wage differentials. Hence the need to bring in unquantifiable and non-economic variables such as stability, political alliances, trade union’s tactics at various centres, policies of labour in different states, as well as attitudes of mill owners. Moreover, wage differentials may not be explained by unquantifiable and noneconomic factors but variables such as accidents, custom and convention. In addition, T.S Papola states that, if the research’s findings are accurate and valid, then it is with no doubt that the existing wage differentials...
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...moved to North Carolina for a more central positioning. This geographical centralization would be advantages for Burt’s Bees because of the theoretical cost saving that the company might have with regards to transportation and distribution cost. There are however some factors that Burt’s Bees have keep in mind and question that need to be asked and answered. The first consideration that has to be kept in mind is that the products that Burt’s Bees currently produce are labour intensive and employees are mainly unskilled. Will this be the same in North Carolina or will labour be skilled and more expensive? Because North Carolina is more central and is a business hub in the U.S.A., what are the completions in this area and markets strategies? What products are similar companies in the natural cosmetics market selling? These questions need to be answered by Roxanne if they wish to be successful in their attempts at expanding Burt’s Bees. These considerations are not limited in deciding whether to move to North Carolina or not but are generic business questions that need to be answered on a continuous basis. There are basically three options for Roxanne to choose from. Firstly she could have stayed in Maine and keep on doing what they have been doing in the past and live with the fact that product distribution is high but labour cost is low. Furthermore the product selection being produced will not change drastically and have a proven track record in the market place. The second option...
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...automobiles drop, so will the demand for the products used to make the automobiles. Derived demand applies particularly to strategic human resources planning in relation to labour. Demand and supply of labour interact to determine the wages and affects the allocation of labour resources in ta corporation. It involves anticipating both the need for labor and the labor supply while planning programs necessary to ensure the organization will have the right mix of employees. The demand for labour is derived form the demand for the goods and services that labour is used to produce. Additionally the demand for labour is influenced by the level of economic activity, the productivity of labour and relative cost of labour compared to capital.[2] The demand and supply of labour are influenced by both macroeconomic and microeconomic factors. Macroeconomics refer to conditions in the whole economy affecting the general labour market. Microeconomic factors include specific industry and company conditions that influence the demand and supply of labour for particular occupations and labour skills. These are factors that are industry or firm specific and include the nature and size of the industry, the pattern of consumer demand and output, the wage rate and conditions of employment offered, the productivity of labour, the rate of...
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...Managing Human Resources Course Code: 4200 Chapter One: The World of Human Resource Management pages 1-28 Human resource management (HRM) The process of managing human talent to achieve an organization’s objectives Human capital: The knowledge, skills, and capabilities of individual that have economic value to an organization. Skills that people bring with them Six Sigma: A set of principles and practices whose core ideas include understanding customer needs, doing things right the first time and striving for continuous improvement Reengineering: rethinking and radical redesign of business processes to achieve dramatic improvement in cost , quality, services and speed Outsourcing: contracting outside work that was formerly done by employees inside the company Change management: bring about and managing change at both the organizational and individual level Proactive Change: Change initiated to take advantage of targeted opportunities Globalization: Opening up foreign markets to international trade and investment Reactive Change: Change that occurs after external forces have already affected performance Corporate Social: The responsibility of the firm to act in the best interests of the people and communities affected by its activities Collaborative Software: Software that allows workers to interface and share information with one another electronically Human Resource Information System:...
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...THE UNIVERSITY OF MANCHESTERMANCHESTER bUSINESS sCHOOL | “Double-Edged Sword”, Emotional Labour | :The examination of the extent to which emotional labour is harmful for workers | | | BMAN31430: Human Resource ManagementCourse Coordinator: Dr. Isabel Tavora799264112TH NOV 2013 | This paper aims to explore fundamental concept of emotional labour, based on the empirical case studies in order to attempt to answer the question, “Is emotional labour really harmful for workers?”, and also investigate the contradictory claim that it is not harmful, including the practical recommendations for problematic emotional labour. | CONTENTS 1. Introduction………..………………………………….…..…… 2 2. Emotional Labour……….…………….…………….………… 3 Surface Acting………….………………………………………………….….……. 3 Deep Acting……………………………………………………………………….... 4 3. Is Emotional Labour Really Harmful for Workers?................ 5 4. Does Emotional Labour Positively Affect Employees?............. 7 5. Recommendations for Problematic Emotional Labour.............8 Creating ‘Downtime’………………………….…………………………….......... 8 Calming Strategies………………………………………………………………... 9 Cognitive Restructuring…………………………………………………………... 9 6. Conclusion…………………………………….……………….. 10 7. References….………………………………….……………….. 11 1. Introduction “Every time you see a guest, smile and offer an appropriate hospitality comment. Speak to every guest in a friendly, enthusiastic and courteous...
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...of scale and scope (Forgang and Einolf, 2007, p. 151). Economies of Scale and Scope The economies of scale exist by the increase of the output of the goods through additional units while the costs decrease. On the other hand, the economies of scope exists when the firm increase the variety of the goods that it sells with the objective of saving to the total cost in comparing two firms produced of two goods. The economies of scale and scope are all found in the industry wherein it has the large scale of distribution, production, and retail for the process of cost advantage over the only small scale. There many sources of the economies of scale as the individualities and spreading of the fixed costs, the specialization of the division of labor, inventories, the increased of the productivity of the variable output, principles of engineering, purchasing and adverting. The disadvantages of this approach is relating to the lack of adaptability to the bureaucratic companies and inflexibility. Nevertheless, the advantages of this approach are the sales force for the selling products can do properly as compared to the only one product. There will also be greater revenues from the base in the process of distribution which can yield to cost efficiency. In this regard, there will also be the synergies at the products which are offering the complete range of the products that...
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...| ASSESSMENT COVER SHEET (NON BARCODED) | Programme of Study: | MBA | Paper Name: | Operations Management | Lecturer: | Dr. Lincoln Wood | Assessment: | Assesment 1 (Group Report) | Paper Code & Stream: Eg 476680/60 | 468911(Mon 6pm) | Word Count: 1529 | Statement of Academic Honesty This assessment has been written by me and represents my own work. This work has not been previously submitted. All sources information has been appropriately acknowledged and referenced. I have maintained and will continue to maintain the confidentiality of any persons/organisations referred to in this assessment. I permit this assessment to be copied for academic processes (such as moderation). I have retained a copy of this assessment electronically. Complete this section for group assessments only. Tanya Chappell – 1313490 Richard Drake – 1272878Saku Abeysuriya – 0437411 Brendon McPhail - 13827929 | LATE ASSESSMENTS You must ensure that this section is completed if the assessment is being submitted after the original assessment deadline. Date handed in? | ........./........./......... | Extension granted? | YES / NO | Operations Management | Assessment 1 – Center...
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...Cost management lecture slide summary Lecture 1 Reasons for US growth 1977-‐2007: end of cold war; China; spread of Internet; Financial deregulation and easy. Business inputs: land; material; labour; capital; enterprise; technology. Business decisions bound inputs with outputs Output: goods, service, information and data. Economically viability; financial variability; Efficiency ($, lowest cost) and Productivity (volume term) Economic efficiency: technical efficiency (values at production possibility frontier) and allocation efficiency (selecting the point, opportunity costs) Business decisions comprise from: -‐ -‐ -‐ -‐ -‐ Economic: micro (price, supply & demand, cost) and macro (inflation, tax) Finance: capital structure (WACC) and capital budget (company value over market) Management Marketing: 5P’s (price, place, people, product, promotion) Accounting: financial (FS, reporting) and cost accounting () Cost types: a) Direct (labour, material) b) Overheads ...
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... Introduction The global environment over the past decade has changed dramatically (Friedman, 2005), with increasing globalization ushering in an era of unprecedented competition, particularly for Western countries in light of the emerging Asian Giants. This has been further compounded by the 2008 financial crisis and the resulting economic crisis (Hill & Jones, 2010), which have led to diminished consumer spending and sluggish demand. These factors have forced most western companies explore new markets for their products, cut costs and source for cheap inputs for their value chains (Cheng, 2009). Companies competing on the international level face a lot of choices in terms of resource allocation, and balancing authority between head office and the business units. Many industries are now so competitive that firms must adopt a transnational strategy (Bartlett and Sumantra, 1991). This involves a simultaneous focus on Reducing costs, Transferring skills and Products, and Boosting Local responsiveness. Implementing such a strategy may not be easy. This essay will discuss how it is hard for a company to implement a transnational strategy to enter and compete in foreign market. Transnational Strategy: a tug of war In this competitive world, many industries are finding it hard to compete in a single market. This is due to increased competition from other established companies. Therefore, companies often tend to come up with strategies across boarders. These are strategies...
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...and opportunity to add insurance cover for fragile or valuable items, or to use online booking system where people can send the occasional parcel without opening any kind of account or having a formal arrangement with the company. “The national network is supported by dedicated account management and costumer services team, which benefits our customers by working with a partner who provides a reliable, secure and flexible services. The company vision is to maintain our position as the expert within the UK parcel market” LO1 Understand the different perspectives of human resources management. Explain Guest’s model of HRM Human Resources Management can be define as “the organisational function that deals with recruiting ,managing ,developing and motivating people, including providing functional and specialised support system to foster regulatory compliance with employment and human rights standards” (Strandberg,2009,p2) Guest’s (1987) ideal-type model is used to characterize...
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...hamburgers. To set up his hamburger business, Joseph will have to borrow $10,000 to have a custom-made mobile hamburger stall with a built in refrigerator, gas bar-b-que plate, storage space for utensils and ingredients and sufficient work space. The National Australia Bank is prepared to lend the money to Joseph for the project over a three year period. Joseph will have to make repayments to the Bank of $480 per month. A local celebrity and once-upon-a-time television cook, Ms Jan Power runs a farmer’s market at the Brisbane Power House every Sunday. Joseph learns that he could rent a space at the Sunday farmer’s market for $200 per day. Joseph has also been estimating the cost of ingredients for his hamburgers. On a per, hamburger basis he thinks he can buy ingredients as follows: Ingredients | Cost per hamburger | Hamburger buns | $0.50 | Hamburger patties (meat) | $1.00 | Salad | $0.40 | Sauces and condiments | $0.05 | Disposable plates and napkins | $0.05 | Joseph thinks he will be able to sell his hamburgers for $4.00 each. But he needs to work out how many hamburgers he would need to sell to avoid losing money. He would also like to work out how many hamburgers he would have to sell to earn a profit of $500 per week. 1. | What are...
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...practices, because it shows how innovation can led to a revolution. Ford was able to increase its output fifty times at the same time as increasing productivity and reducing its labour and production cost. This was due to a combination of factors; among them we have the continuous flow of the labour, which was achieved by organising the machines by sequence of use. This eliminated unnecessary employees engaged in material handling, thus reducing labour costs. Other factors were the introduction of a new assembly technique, widely known as the “MAL” (Moving Assembly Line), and the fact that Ford also extended its manufacturing innovative techniques into the components and materials that their products needed. This success implied a constant search for dynamism and change in their production lines, in order to satisfy the growing demand. Innovation then, is a key part of the development of a successful business companies, it was back then and it is nowadays. In order to develop a successful business company, is necessary to pay as much attention as we can to operational detail, since it helps us to identify which activities add value to the product and makes it easier to optimize the process by being able to reduce costs and time. This is where the main idea of business analysis is born. The idea of managing operational detail fascinated F.W. Taylor, whose contribution to this subject is commonly known as “Scientific Management”. He states that it is absolutely necessary to understand...
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