Economic Health

Economic Health - Economic Health Government economists and...

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Economic Health Government economists and analysts have labeled the United States economy over the last two plus years as being in a recession. A recession is defined as two consecutive quarters with negative Gross Domestic Product (GDP). There was a 2.8 percent decrease in domestic GDP from 2008 to 2009, a result primarily from the real estate bubble bursting due to bad debt mortgages. The sharp recession has caused many people and businesses to cut back on spending or face steep losses that immediately forced many Americans to leave their houses and companies to lay employees off. The downturn resulted in the national unemployment reaching 10.1, considered to be about double the normal rate. These situations have forced the government to intervene and invest billions of dollars into the economy to help turn things around, and as a result in 2010 GDP is expected to grow slightly from 2009. Most inelastic goods rarely feel the effects of economic factors because such as medicine and food can’t be replaced by any substitutes. Strollers fall into category of a necessary good, but the question for Emmaljunga is whether current economic factors prohibit the company from finding success with their luxury strollers in the current market.
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