Notes, abstracts, papers, exams and problems of Economy

Economic Boom and the Great Depression

A period of general prosperity in the 1920s ended with the collapse of the Great Depression in the 1930s.

Key Factors and Events

• Bull Market: A stock market in which stock prices were steadily increasing. In the bull market of the 1920s, stock prices became vastly inflated.
• Buying on Margin: Purchasers were able to buy stocks on margin, putting only 10% down and borrowing 90%.
• Speculation Boom: Refers to the practice of buying real estate, stocks, or anything else to sell later at a profit.
• Black Tuesday: The market crash on October 29th.
• Smoot-Hawley Tariff: Reduced international trade.

Key Figures and Groups

• Herbert Hoover: Republican who believed in Laissez-faire economics. He did not think the federal government

Benefits of eMarketing Over Traditional Marketing

Demographics and Targeting

Internet users represent a desirable demographic for marketers, often possessing greater buying power and skewing towards the middle class. The internet's structure allows users to organize into focused groups, providing marketers easy access to niche markets. This targeted approach maximizes the effectiveness of marketing messages.

Adaptivity and Closed-Loop Marketing

Closed-loop marketing relies on constant measurement and analysis of marketing campaign results. Real-time analysis of responses allows for continuous adjustments, minimizing wasted advertising spend. This dynamic approach, combined with the internet's immediacy, allows for maximum marketing efficiency... Continue reading "The Power of eMarketing" »

European Union Energy Market Regulations

1st package- Directives 96.92 concern common rules for the internal market in electricity and 98.30 internal market of natural gas. Liberalization was to be progressive, applying gradually to different categories of consumers. Introduce a partial opening of national markets to competition, both required liberalization of certain segments of their electric and gas markets to enlarge. 2nd- 2003.55-54 liberalization process took place at different speeds in different member states aiming at the creation of an internal market. Required national gas and electric markets to be liberalized for large consumers by 2004 and 2007, respectively. 3rd- Directive on electric, on gas, security of supply electric, regulate... Continue reading "European Union Energy and Financial Market Regulations" »

Parent > Subsidiaries: Gain

Proceeds from Sale (Cost)

Carrying Amount of Plant Sold (Capital Proceed)

Plant (Profit)

DTA (of Profit)

Income Tax Expense (of Profit)

Accumulated Depreciation (of DTA)

Depreciation Expense (of DTA)

Income Tax Expense (of Dep)

DTA (of Dep)

Years After Sale

Retained Earnings (Profit x 0.70)

Plant (Profit x 0.70)

Subsidiaries > Parent: Gain

Plant (Profit)

Proceeds from Sale (Cost)

Carrying Amount of Plant Sold (Capital Proceed)

Income Tax Expense (of Profit)

DTL (of Profit)

Depreciation Expense (of DTA)

Accumulated Depreciation (of DTA)

DTL (of Dep)

Income Tax Expense (of Dep)

Payment Methods

• Online shoppers commonly use a credit card or a PayPal account in order to make payments.
• Other alternative ways:
  • Billing to mobile phones
  • Cash on delivery
  • Check
  • Debit card
  • Electronic money
  • Gift cards
  • Postal money order
  • Invoice

Product Delivery

• Downloading (for music, movies, images…)
• Drop shipping (the manufacturer ships the item directly to the consumer)
• In-store pick up (going to a real shop)
• Printing or by e-mail (ticket for a concert, cinema, etc…)

Advantages

• Convenience: Online shops are usually available 24 hours a day and many consumers have internet access both at work and at home.
• Information and reviews: Online stores give more information about the product (instructions, demonstrations, advice or how-to guides). Customers can

Production and Productivity

Production is the provision of a product to satisfy wants and needs. The process involves businesses adding value to their products. Productivity: is the outputs measured against the inputs used to create it. This is measured by: Output (over a given period of time)/Number of employees If a worker makes more products in the same amount of time, his productivity increases. Firms aim to be productively efficient to be able to make more profits and compete against their competitors.

Methods of Production

Job production: Goods are made individually, by one person. Goods are usually specialized, no two goods are the same. Usually made to order. Pros: The product meets exact requirements of the customer. The workers have... Continue reading "Understanding Production and Methods of Production" »

The Great Depression: The Longest and Deepest Economic Downturn in American History

Causes of the Great Depression

In 1929, the prevailing economic theory held that the economy possessed self-correcting mechanisms that would prevent a severe depression. However, the Great Depression defied these expectations.

• Overproduction: Some economists believed the depression was caused by an excess of goods and services.
• Lack of Investment Opportunities: Others pointed to a decline in profitable investment opportunities.
• Technological Innovation: Joseph Schumpeter argued that the failure of entrepreneurs to introduce new products contributed to the depression.
• Stock Market Crash and Bank Panics: The stock market crash of 1929 and subsequent bank failures exacerbated

Understanding Global Inequality: Thomas Piketty's Capital in the 21st Century

The Inequality Problem: R > G

Thomas Piketty's research on inequality has gained significant attention, particularly his formula r > g, where:

• r represents the return on capital (profits or interest from investments)
• g represents the overall growth of the economy

Piketty argues that over time, wealth concentrates in the hands of the wealthy few, regardless of hard work or intelligence. The actual distribution of wealth reveals higher inequality rates than commonly perceived. To combat this, he advocates for active redistribution and improved access to education.

Capitalism and Inequality

Piketty's book, Capital in the 21st Century, challenges the notion that capitalism... Continue reading "Understanding Global Inequality: A Deep Dive into Thomas Piketty's Capital in the 21st Century" »

Topic 1: Intro to FAB

Types of Businesses: Manufacturing (make & sell), Merchandising (buy & sell), Services (delivery etc.)

Business Structures: Sole Proprietorship -> owned and opened by 1 person; business is a separate entity from owner, owner is liable for debts. Partnership -> 2 to 20 partners; business is a separate entity from partners, partners are liable for debts.

Types of Partnerships: 1. General -> equal responsibility & unlimited liability. 2. Limited (Liability) -> 1 partner(s) not liable for debts beyond the agreed obligations. 3. Limited Liability Partnership (LLP) -> ≥2 partners are separate legal entities and are not liable for business debts. Business ceases if partner dies UNLESS have perpetual... Continue reading "Understanding Business Structures and Financial Fundamentals" »

Shifts toward the connected customer, from

Exclusive to inclusive à (innovation and diversity, mass markets, social media as a redefinition of how people interact)

Vertical to horizontal

à open innovation, ecosystem business, branding (value…)

Individual to social

à most personal purchase decisions will be social decisions, lack of control over marketing communication, high impact of community generated content

ATTRIBUTION MODELLING

1. Method to determine the value of different channels on marketing efforts.
2. Allows to map which channels provide the most benefit to a marketing campaign.
3. Way in which marketers assess the value or ROI of the channels that connect them to potential customers.

Goal:

• Map effects and value of a campaign’s components

Measure:... Continue reading "Shifting to the Connected Customer: Trends and Strategies" »