To achieve this objective, you will play the role of an economic advisor working for a company in one of the following industries: (1) automotive; (2) construction; (3) financial services.
*Pick one that interest you
Objective 1. Your first objective as an economic analyst is to consider current and future impacts of the recession on your industry, using appropriate terminology and concepts.
You will need to consider the following questions:
● How do we know that we are in a recession?
● What are the relevant indicators of a recession?
● How is the recession manifesting itself in your industry and in society as a whole?
Objective 2. The second objective is to use macroeconomic theory to explain the recession and its effect on our world today.
Review the business cycle and the postulation that “what goes up must come down,” given what is occurring in your industry.
Identify and discuss the main sectors that propelled the growth of the economy over the last 10 years and relate this to your industry.
Review the sectors and pay particular attention to seminal events that showed how the economy first went through an expansionary phase, peaked and then started to slow down.
Please do not ignore the role of the Federal Reserve and its “easy money” policy after 9/11/2001.
● What was the reason for the growth of the economy over the last 7-10 years?
● What was the role of the Federal Reserve and its ‘easy money” policy?
● What were the macroeconomic effects of this policy on the main sectors of the economy?
Please elucidate how this policy affected the following sectors of the economy:
- Automobile industry. 2. Housing industry. 3. Financial Services industry i.e. stock markets and banks. 4. Unemployment.
Objective 3. The third objective is to write a conclusion reiterating the main findings and whether the economic theory was helpful in explaining the recession and its effect on you. (about 1-2 pages).
Is your conclusion logical and applicable in the future? Have you drawn accurate postulates?
How difficult was it to find a theory for the cause of the recession?
What do you believe is the cause of the recession and do you believe it will happen again?
How has it changed you and what steps have you taken? Objective 1 states that we need to write it from the perspective of one of the listed industries but Objective 2 wants us to again reply to the questions using our chosen industry but also research how the "easy money" policy affected all 4 listed industries, correct?
Answer: Objective 1 does indeed want you to do a one industry based perspective of the Recession and then Objective 2 would like you to include the "easy money" policy and its effect on all 4 listed industries. It is actually a request to do a slightly more broad based analysis.
Do you want this based on the 2007-2009 recession or based more on today's economy? Answer: The paper should address the 2007-2009 Recession and then towards the end, you may include how the Recession affected you during those recessionary years and how you reacted to it and how it changed you.