Notes, summaries, assignments, exams, and problems for Economy

Social Networks

are spaces on the internet formed by communities of individuals with interests and activities in common, such as friendship, kinship, work, and that allow contact between them, so they can share content and interact.

No one thought that social networks were going to be a success

Many believed that they were just going to be a fad and would soon disappear. What is even more surprising is that it is now a consolidated universal platform, a highly requested and necessary tool for a brand, company, business, or artist. But it is not only of great help for various sectors, also for any individual who is in them.

Now, networks are already generating employment

but it was never thought that it would ever exist. New jobs were born due to

Balanced Budget

Balanced budget is when current revenues equal current expenditures; however, when a deficit budget occurs causing revenues to fall short of expenditures, it requires the government to borrow money or even tap into reserves to make up the difference. This becomes a requirement that shapes the entire budget process, thus making budget deliberations revenue-driven when revenues determine the level of spending. Balanced budget is elusive when authorities propose a balanced budget but the council approves an unbalanced one or state or local laws allow the deficit at the end of the year to be carried over to the next year. Furthermore, there are no consistent or enforced standards for the balanced budget since it may be manipulated... Continue reading "The Importance of Balanced Budget and Tax Neutrality in Financial Management" »

Product

Product is anything that can be offered to a market for attention, acquisition, use, or consumption, in order to satisfy customer needs.

Consumer Products

are bought by consumers for personal consumption.

Industrial Product

are bought by other companies for further processing or use in conducting a business.

Product Value (Creating and communicating value): 2 ways

• The customer-value hierarchy

Perceived value will differentiate a company from competitors and will make the product more attractive for the market.

• Core benefit
• Basic product
• Expected Product
• Augmented Product
• Potential Product

• Value Proposition

consists of identifying the Benefits, Barriers, and Needs. Describes the benefits customers can expect from your products and services.

• Benefits
• Experience
• Barriers
• Needs
• Features

• The

California Property Tax & Budgeting Sector Differences

California's Prop 13: A Non-Neutral Tax System

Property tax in California operates under a non-neutral system, initiated by Proposition 13 in 1978. This landmark legislation linked the tax rate to a property’s sales price at the time of acquisition, with a maximum 2% annual increase on the assessed value. As noted by Bland, this structure means the tax rate is determined by the sales price, primarily benefiting owners who retain their properties for extended periods. The low annual increase on property tax has resulted in significant tax disparities, allowing long-term property owners to realize substantial tax benefits over time, especially upon sale.

Impact on State Revenue and Local

Government Financial Reporting

Governments combine blended components into both fund and government-wide (GW) statements.

Chapter 8- NPV

Opportunity Cost of Capital: expected rate of return given up by investing in a project

Net Present Value: Present value of cash flows minus initial investment--> difference between value and cost.-->reflects time value of money

Risky dollar worth less than safe one

Capital Budgeting Decision: is concerned with finding out investments that maximize value of the firm

IRR: the discount rate at which project NPV = 0 --> accept project if IRR is greater than opportunity cost of capital

Payback Period- time until sum of project cash flows equals the initial investment--> accept if payback period is less than some specified number of years

Discounted Payback Period - Accept project if discounted payback period is less than some... Continue reading "Maximizing Firm Value Through Investment Analysis" »

ALOS: Average Length of Stay

Total occupied room nights/total bookings

Attrition

Difference between the number of rooms reserved compared to the number of rooms used

Booking Curve

An important tool for yielding that provides a visual representation of the pickup, number of bookings, availability, and yielding capacity of the hotel over time

Pick Up

No. of reservations between today & day of arrival

Contract

>30 nights + large volume

Group

>10 rooms, contract, deposit

• Corporate: Negotiated rate for a block with a specific company
• Association/Convention: Negotiated rate for a block with trade, professional, philanthropic association
• Government: Negotiated rate for a block with a qualifying government agency

Transient

Ind & groups

• Retail: Market

One of the advantages of licensing is: licensees have considerable autonomy.

Pollo Campero, a chicken restaurant chain: franchising.

Prior to the economic crisis of 1997-1998, South Korea's TRUE

Saab markets two luxury car models, country concentration/market segment concentration

Sony entered into a strategic partnership TRUE Starbucks' relentless pursuit of TRUE

Successful GSPs create win-win situations, mission

Tata Motors (India) acquired Jaguar (UK).

The agreements that allow McDonald's franchisees franchising

The alliance between GE T, The driving force T, The South Korean government has recently F

The disadvantages of joint venturing can Joint ventures allow partners to achieve synergy.

The failure of partnership between Great T, The joint venture... Continue reading "Global Strategic Alliances and Joint Ventures in Business" »

1.5 Protection vs. Integration

Protectionism: The protection objective is to keep alive domestic production and to increase import prices. For this purpose, it uses different instruments:

• Tariffs: taxes on imported goods to protect the domestic industry. An external tariff is a 'tax' on foreign products introduced in the domestic market. The effect is that its price is higher and it is more difficult to compete with domestic products.
• Quotas on imports: is a limitation of the quantity of foreign products to be imported, regardless of the price. Quotas limit imports and increase domestic prices. The limited quantity is an obstacle for foreign products when international prices have decreased.
• Non-tariff barriers: are administrative regulations for

The US: Prosperity, Crisis, and the New Deal

The Roaring Twenties: An Era of Economic Growth

The decade from 1918 to 1929, following World War I, was a period of significant economic growth in the United States. The American Way of Life, with its core values of individual initiative and the pursuit of success, became an influential model for much of the world.

Key Drivers of 1920s Economic Growth

• Significant technical innovations.
• The implementation of Fordism (mass production techniques), leading to mass consumption and a booming stock market.
• A notable rise in workers' wages.
• Extensive and persuasive advertising campaigns.
• The widespread availability of hire-purchase (installment buying) options.
• Increased accessibility to bank loans for businesses