Managers need to understand the impact of the macroeconomic environment on their firms and industries competitive strategies.

Managers need to understand the impact of the macroeconomic environment on their firms and industries competitive strategies. Investigate which factors determine the personal consumption expenditure

Expert Solution

There are several macroeconomic factors that affect personal consumption:

Inflation rate: If the inflation rate is on the higher side i.e. the prices are increasing fast, the real value of money that the people have is declining and their purchasing power falls. This will lead to lower consumption expenditure.

Growth rate: If the real GDP in the economy is growing at a rapid pace, it means that more and more economic output is being produced and people are getting richer with higher incomes. This should increase their purchasing power and increase consumption.

Tax rates: What matters for personal consumption is not just income, but the post-tax income. If the tax rates are high, a large portion of income is given to the government and personal consumption will suffer.

Interest rates: People regularly borrow money for various consumption expenditures. If the interest rates are low, it will spur borrowing as the interest burden is low and will boost personal consumption.

Rahul Sunny answered 2 years ago

There are linkages between the microeconomic decisions made by managers and the macroeconomic environment. There are...

There are linkages between the microeconomic decisions made by managers and the macroeconomic environment. There are numerous examples from the current recession of company layoffs at the micro level, directly influenced by the decline in economic activity at the macro level. For this assignment, research this linkage. How did the recession impact businesses/managers at the macro and micro levels? You may use one company as the basis of your research. 1500 words essay

To stay competitive and superior fit to the competitive environment, strategic managers might consider level of...

To stay competitive and superior fit to the competitive environment, strategic managers might consider level of strategy. What are the three levels of strategy. Explain the level and give example of one company in Indonesia , that might formulating those levels

Identify the competitive advantage strategies and explain why most firms pursue only one of these strategies.

In order for GE to remain competitive they will certainly need managers that are flexible and...

In order for GE to remain competitive they will certainly need managers that are flexible and innovative...as well as good problem solvers. How do you think your skills measure up in these areas?

Investigators need to study the impact of the Coronavirus outbreak. It is of interest to understand...

Investigators need to study the impact of the Coronavirus outbreak. It is of interest to understand how the number of hospitalizations in a particular state is associated with three predictors including the number of tests available, whether the social distancing measures are taken, and the overall population size. Answer the questions below: 1. Identify the outcome variable and its type (continuous, or binary, or count). 2. What are the predictor variables? 3. (Give the name of the model that you...

When business managers of firms in a competitive market observe falling profits, they are likely to...

When business managers of firms in a competitive market observe falling profits, they are likely to infer that the market is characterised by: A. a violation of conventional market forces B. rising prices C. too few firms in the market D. over-investment

Analyze the competitive environment to determine the Harley Davidson’s most significant competitor. Compare their strategies at...

Analyze the competitive environment to determine the Harley Davidson’s most significant competitor. Compare their strategies at each level and evaluate which company you think is most likely to be successful in the long term.

Why do managers need to understand product and period costs, what are their differences?

Research information on current tariffs and examine their impact on the domestic economy and competitive strategies....

Research information on current tariffs and examine their impact on the domestic economy and competitive strategies. Please I want real time examples with explanation

Analyze the competitive environment to determine Wawa's most significant competitor. Compare their strategies at each level...

Analyze the competitive environment to determine Wawa's most significant competitor. Compare their strategies at each level and evaluate which company you think is most likely to be successful in the long term

Question