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American Business Leslie Lum Bellevue Community College
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What is the economy?
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Brainstorming What is a business? What is the context of a business? What environment does it operate in? Form a group –Brainstorm what a business is –Draw a picture of your ideas –Report back to the class
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Part of the U.S. economy? Building a house in New Mexico Toyota cars assembled in Kentucky Hair salon in South Dakota Seattle SuperSonics Coca Cola plant in China
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Who wants to be a millionaire-- http://www.worldbank.org/data/quickreference/quickref.html What is the size of the US economy? How does it compare to the rest of the world?
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Measuring the economy GDP adjusted for inflation. Growth is graphed. Value of goods and services are totaled.
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The rate of change of GDP Growth Period of Expansion Contraction Recession
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2004/5 data http://www.whitehouse.gov/fsbr/esbr.html
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Inflation Increase in the price of goods and services How do we measure it? Is it good or bad? What has been the inflation rate for the past 30 years?
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Consumer Price Index http://www.bls.gov/cpi/home.htm#tables
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Inflation
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How does the US compare? http://www.nationmaster.com/graph-T/eco_inf_rat_con_pri
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Role of Government Monetary Policy - Federal Reserve sets interest rates Fiscal Policy - Spending to stimulate economy
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Can the Government afford to help? Deficits or surplus ($billion)
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Monetary Policy - How it works
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The Whole Picture The Business Cycle is crucial to business planning
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How to avoid finding yourself in the middle of a recession Important to look ahead Predict upturns and downturns
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Economic indicators Construction Manufacturers’ shipments, inventories, orders Employment Consumer credit Wholesale trade Capacity
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Shifts in the American Economy The American Economy consists of many industries Not all industries are growing or contracting at the same rate Where should you be?
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