The Macroeconomic Paper tests your ability to apply economic principles to a business decision considering the impact of macroeconomic variables.

Select one situation from the items outlined below:

Each of the scenarios has a list of Macroeconomic areas you are to address, with sources, in your answer. Briefly you are to research and show how these apply to your scenario: GDP growth rate, the business cycle, fiscal policy and level of unemployment, monetary policy and interest rates, international trade, and demographics.

Situation C

Cousin Edgar is always thinking of the next business idea. This time, he plans to invest in buying four gas stations. He reckons American consumers have come to accept the high gasoline prices, and estimates world prices for gasoline to increase even further with high demand from India and China. Besides, Cousin Edgar thinks he will make a good profit on the sale of convenience items at each station. But before buying the gas stations, he decides to ask for your advice because you are taking this course in business economics.

You happened to read the piece "Bank Lending Signals a Strengthening Economy" on page 856 of the textbook. Cousin Edgar needs financing for his new business, but you realize there are more macroeconomic factors he needs to consider in timing his decision. You decide to research the economy in terms of GDP growth rate, interest rates, level of unemployment, the business cycle, fiscal policy, monetary policy, international trade, and demographics. You want to provide Cousin Edgar with the most informed advice possible.

Macroeconomic Paper as a Professional Report

Your paper should be organized into five parts as listed below.

1. Title Page: Name, class, and date
2. Introduction to situation but do NOT copy the scenario. Briefly summarize the situation and identify the macroeconomic issue(s) to be decided from the perspective of the organization.

3. Business Cycles, Unemployment, Inflation, International - Comparative Advantage, Exchange Rates, Trade, Etc., Monetary Policy and Interest Rates, and Fiscal Policy and Unemployment Identify the variables that are critical in addressing the issue(s). Gather and present the relevant data on the variables by searching the DeVry Online Library. Ask a librarian for help if needed. Use in-text citation to report the source(s) of the data. Graphs may be included here.

4. Recommendations and Economic Justification

Formulate and present your recommendations for addressing the issue(s) based on the relevant data and economic principles identified above. Justify your recommendations in terms of the economic impact on those affected.

5. References