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Unformatted text preview: Final Project 1 Macroeconomics is the field of specific economics that studies the behaviors of the aggregate economy. Macroeconomics examines economy-wide phenomena such as changes in unemployment, national income, rate of growth, gross domestic product, inflation and price levels. Explicitly it is focused on the movement and trends in the economy as a whole, while in microeconomics the focus is placed on factors that affect the decisions made by firms and individuals. The factors that are studied by these two separate entities of economics often influence each other, such as the current level of unemployment in the housing industry and housing economy as a whole will affect the supply of workers which an contracting firm can hire from, just as one example. The housing industry I feel has several factors which affect the supply. One of these factors would be the employment costs such as wages, overtime payments and employer national insurance contributions, medical benefits, etc. With the rising cost of employment it is beginning to become difficult for employers to continue to raise funds to higher on new workers. Minimum wage continues to rise, therefore the price of overtime rises as well. The cost of medical plans and benefits continues to increase which in turn causes more money to be taken away from production and put towards protecting the employee. The second factor that I feel affects the supply in the housing market would be the costs of purchasing building components and the raw materials needed to complete each project. As our country is moving towards eco-friendly markets, products for said markets are gaining increasingly expensive materials. As the prices for housing continue to rise so will the prices of the overall house. This is a negative Final Project 2 that needs a much stronger economy to be fixed. People barely have enough funds to pay their current mortgage let alone purchase newer more expensive homes. Two factors that I feel would affect the demand in my industry would be location and local economics. Location in the housing market is a huge factor in the success of the industry. I feel that the more urban an area is the more successful the market will be. Urban areas usually signify jobs and where there are jobs there are people and where there are people there are homes and buildings that need to be worked on or constructed. Thus, the market might not be flourishing but it would definitely be more successful than that of a market in the middle of nowhere. Secondly, the local economy has a large effect on the industry. If the local market cannot support the production of new houses or buildings than the industry will fall, much like it has done here in Ocala....
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This note was uploaded on 08/21/2011 for the course ACCT 1221 taught by Professor Adgams during the Spring '11 term at Stetson.
- Spring '11