Question

Covid-19 has dramatically transformed our economy at speed. Consumers are concerned about the impact pfnthe pandemic from economic and health prespective. Pick one or two markets( restaurant, entertainment, clothing) to analyze the changes that have taken place, the factors that contribute to the changes, and the future changes, both in the short run, that are likely to happen.

Answer 1

COVID-19 pandemic has shaken the economy. Due to coronavirus pandemic small industries and businesses has impacted which has slowed down the economy. With situations involving huge numbers of tasks being cancelled and also increasingly avoidance of the hotels, restaurants, and travel; the pandemic has hugely affected the restaurant and airline industry

In the US, majority of the hotels had reported a sharp rise in cancellations for both group events and individual reservations. It has caused a load of wastage of perishable items due to disruption in transportation and lack of demand. The tourist and travel segments along with the recreation segment are mainly declining due to the lockdowns happening across the globe. The rapid expansion of the requirements of social distancing and travel restrictions, as well as the growing number of governmental orders on stay-home, has been unprecedented in its severity and breadth. As a result, in the short run most of the hoteliers both large and small have elected to close their doors for now as they are not able to cover their average variable expenses

In a similar way although all companies would not be equally exposed to corona virus risk; however the pandemic has certainly shaken the airline industry. Business travellers are grounded because the conferences and meetings are cancelled while the leisure travellers are scared of travelling. Normally United Airlines lure the reluctant customers with the discounting fares, however today it is not working due to the outbreak of COVID-19. Today the United Airlines has slashed the international flights with nearly 85% as it was operating six months back. Since the demand has collapsed due to Covid -19 thus have elastic demand. The virus is fast-spreading and no vaccination till now has abruptly dented demand and supply across industries as well as nations.