Essay on Macroeconomic: Economics and Gas Oil

1212 WordsMay 25, 20145 Pages
MACROECONOMIC ANALYSIS Russ Graziano ECON 545 Keller Graduate School of Management April 13, 2014 Introduction The idea Edgar has for opening up four new gas stations is based on a well based argument making it viable as a profitable business venture. The evaluation on the American consumer to accept the high price for gas oil prices forms the first approach towards establishing a business. Gasoil businesses in the world run as cartel where it supply and prices are determined by the few stakeholders in the industry. The stakeholders form an agreement among their competitors on the price, making and, marketing of the product (Fredy, 2010). The cartel though the production affects the GDP…show more content…
Convenience goods are those that are distributed widely and are inexpensive and the gas oil forms one of them (Fredy, 2010). Macroeconomic covers the demographic aspect, as these goods are made available to the population. Demography represents human residents statically (Henry, 2008). Startup capital is a needed by Edgar as he plans to buy the four gas oil station. The fund borrowed from a financial institution will be affected by the interest rate and the financial policies. The monetary policy is a tool used to control the supply of money in the society through affecting the interest rate in the society (Tayor, 2007).The estimates of sales to increase in china and India represents the trade cycles. Business cycles are periodic change in the production and affect the Gross Domestic Product of a country. They cause the GDP to fluctuate and thus an expansion and contraction of the level of economic activities in the country (Tayor, 2007). The business sets itself on time of favorable economic benefits as the bank rates are favoring a business positively. Edgar requires a large capital base to start a business and borrowing from a business organization is paramount. Interest is payable on the loan capital that is taking from such institutions. With a low lending rate, the business organizations enable economic growth as a society can borrow a large sum of money for the investment project. Investment
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