Assessing

economic
condition
Economic growth

Strong economic growth and its Weak economic growth and its
impact impact
 What happens if
growth is negative for
years?
RECESSION
Indicators of economic growth

Level of total production of products and services

Aggregate expenditures

Level of unemployment (Alternative)

 Frictional

Seasonal
Unemployment:
types
Cyclical

Structural
Increase in general price level
over a specified period.

Estimated by measuring the %

change in consumer products Inflation
generally.

Inflation affects operating

expenses, Wages, and Revenue
Inflation: types

Cost-push inflation

Demand-pull inflation
 Impact of interest rate

Impact on firm's expenses Impact on firm's revenue

Determining market prices

· Demand schedule for a product

· Supply schedule for a product
· Interaction between supply and demand
 Market Income level
price:
factors Taste and preference
that
influence Expenses
Can government influence?

Monetary policy

Fiscal policy
Thank you!