Economic analysis and PESTLE for a London hotel and restaurant.
BUSINESS ENVIRONMENT BY MR Abhishek R Patil 735607 Introduction: Business environment comprises of two words "Business" and "Environment". According to Worthington. I, Britton.C, 2009. 'Business' is a commercial activity which is designed to provide goods and services or both to the consumer in order to generate profit on a consistent basis. On the other hand 'Environment' refers to the different aspects of surrounding. Therefore Business environment can be defined as surrounding which affects the performance of the organization which cannot be controlled. Environment has two components: * Internal environment. * External environment. Internal environment: it consists of 5M's, Man, machinery, management, money, material. It is can be control easily and can make changes accordingly. External environment: it consists of micro and macro environment. Micro environment include suppliers, customer, competitor, buyer and public which are close to the organization. Macro environment include social, economic, political, legal and technology which normally gives opportunities or creates threats to the business. It not only affects the performance of the organization but also there is the need to change the strategies accordingly. ) THEORY OF DEMAND: According to Burton.D and Wall.S, (2011). Demand can be defined as the quantity of goods or services that customer is
The cause of the AIGs collapse
The cause of the AIG's collapse and how to avoid the next crisis Introduction American International Group, Inc. (AIG), world leaders in insurance and financial services, is the leading international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services, and asset management around the world. However, AIG suffered a liquidity crisis following the subprime mortgage loan crisis and its credit downgrading, including $9.11 billion of net unrealized market valuation losses on Capital Markets' super senior credit default swap portfolio in the first quarter of 2008. On September 16, 2008, AIG collapsed and became a state-owned corporation when the United States Federal Reserve Bank rescued it by offering a loan to AIG as much as $182.5 billion, in exchange for 79.9% of the equity of AIG. Analysis The collapse of AIG can be explained by the following internal and external factors. Internal Factors (i) Inadequate internal controls AIG Financial Products Corp. (AIG-FP) is a wholly owned subsidiary of American International Group, Inc. and founded in January 1, 1987. It was set up to
Inter Macroeconomics essay - Theories of aggregate supply seek to reconcile rational behavior with the observation that nominal shocks have real effects.
Inter Macroeconomics essay ZhiyuWan Title: theories of aggregate supply seek to reconcile rational behavior with the observation that nominal shocks have real effects. The theory of aggregate supply helps people better understand both fiscal and monetary policies. Obviously, there are several explanations about aggregate supply such as the new classical theory and the new Keynesian theory. Generally, the new classical approach stresses market equilibrium, competitive markets and rational expectations; the new Keynesian theory stresses disequilibrium and imperfect competition, but also incorporates rational expectations. By comparing, I believe the new Keynesians' model would probably better explain the question. Let us look at the new classical theory first. The New Classical models developed in the 1970s combined the 'natural rate hypothesis' with rational expectations where it is assumed that firms know their output prices but workers from expectations about the price of the goods and services they buy. They predicted that counter-cyclical macroeconomic policies like fiscal and monetary policies designed to smooth out the business cycle would not work. New we start with the algebra of the theory. In the labour market, nd = xd - x1 (w - p)= xd + x1 (p - w) ns = xs + x2 (w - pe) Assuming equilibrium in the labour market, we solve for the
The entrepreneurial dilemma reflection
INB 356 SME Management Post-seminar reflection - week 3 In week three we were introduced to different models/theories of companies' growth and the different factors that separate the fast growing SMEs from the rest. In addition, we completed the 1st part of this assignment (applying two models to the case-study; growing pains). Following this is our reflection on the knowledge we gained during the discussion on Friday's session. Although we have analysed many important and accurate aspects of the case study, we have realised that there are some issues that need some revision. In the following part we will look into some additional point of views on the case-study. We will revise our views on both Churchill and Mintzberg, look more into the accuracy of each one, as well as clarify some assumptions mentioned in our pre-seminar analysis. * During the in-class discussion of Churchill we realized that there are a couple of arguments which should have been taken into account during our pre-seminar report, as there seemed to be a general disagreement of what exact phase Softhouse is positioned within at the time the case-study was written. To be able to find Softhouse's key problems and thereby make recommendations, we find it vital to decide on what phase they are positioned within, as this model recommends different solutions and advice for each phase. Based on the
What is a conceptual framework for financial reporting?In general terms conceptual framework is a statement of generally accepted theoretical principles, which form the frame of reference for
.0 What is a conceptual framework for financial reporting? In general terms conceptual framework is a statement of generally accepted theoretical principles, which form the frame of reference for a particular field of enquiry. In terms of financial reporting, these theoretical principles provide the basis for both the development of new reporting practices and the evaluation of existing ones. " (Davies et al. 1993 p.20). " (O)ne cannot make a rational choice of accounting procedures without some framework of principle " (Macve 1981 p.9) . . The Corporate Report by ASC 1975 The fundamental objectives of corporate reports were to communicate economic measurements of, and information about, resources and performance that would be useful to those users having a right to such information. To fulfill this objective, corporate reports had to possess the following qualitative characteristics; relevance, reliability, comparability, understandability, completeness, objectivity and timeliness. 2. The Watts Report by ASC 1978 Many of the recommendations of the Watts Report concern fundamental issues, which remained unresolved and were consequently revised by the Dearing Committee. These included such issues as the need for a conceptual framework; the establishment of a supervisory body to ensure compliance with accounting standards; the application of certain standards only to large
An Empirical Investigation into the Relationship between Investment and Economic Output / Growth
An Empirical Investigation into the Relationship between Investment and Economic Output / Growth Background We will be investigating if there is a relationship between Investment and economic output in Greece between 1970 and 2004. Although we have relatively minimal initial knowledge about the Greek economy, we feel it is fair to assume (as a developed economy) Investment and GDP will be strongly positively correlated. AD/AS Analysis:- National Income Identity: YDˆ = C + Iˆ + G + (X - M)1 The above is known as the 'National Income Identity', though is often referred to as the equation for aggregate demand. By definition an increase in Investment in this diagram will lead to an increase in national income as Investment is part of the equation. Cobb Douglas Function: YSˆ= f (Kˆ, L)2 Potential output within the economy is identified by the Cobb Douglas function. It links capital stock and the labour force with total output. Increased Investment in the economy leads to more capital stock (e.g. new machines), causing an increase in potential output. This will increase Greece's productive capacity. Actual Output: Yˆ = min (YS, YD) ˆ Actual output is equal to the minimum of both demand and supply. As increasing Investment therefore has the effect of increasing both aggregate demand and supply, GDP will undoubtedly rise. If we demonstrate this graphically using
British Grocery Market-market structurre, supply & demand curves & economies of scale
The grocery market in the UK is driven by 4 main Players: Tesco, Asda, Morrison's and Sainsbury (based on TNS till roll data each have overall market shares of more than 10 per cent)- their marketing policies determine the way consumers buy and want. The first part of the paper focuses on the description of the British grocery market and its structuture. There is a wide variety of different types of grocery retail operator. The CC (Competition Commission) report in 2000 is based on publicly available information, supplemented by data provided by the supermarkets and other retailers. The CC describes the market dividing it into 4 groups: * Supermarket multiples - including Asda, Morrison's, Sainsbury's and Tesco; smaller chains such as Summerfield, Waitrose and Marks & Spencer; and 'discounters' such as Aldi, Lidl and Netto * Symbol groups - can be loosely defined as multi-store chains where there is a single fascia, but where ownership can be fragmented: examples include Musgrave, which operates the Budgens and Londis fascias, and Spar * Co-ops - that is, co-operative stores, which usually operate in a similar way to symbol groups, and * Independents - stores which are independently owned and are not operated under a wider 'symbol' This paper aims the four largest supermarkets- Asda, Morrison's, Tesco and Sainsbury's- as they have an extremely important part of the
cemex case study
Master degree Business Administration Innovation and entrepreneurship BUS 705 Essay Cemex S.A. Prepared for: Rodd Farr-Wharton Prepared by: N Spykerman Cemex is one of the largest cement and concrete companies in the world with operations in 50 countries and revenue of US$ 15.2 billion last year. It claims that its continuous growth since 1968 is caused by continuous innovation (case_p1). It can be disputed whether innovation is the only factor that contributes to innovation. The purpose of this essay is to identify the factors that contribute to successful growth in business. Examples of Cemex will be used to illustrate the topics. This essay defines what 'growth' and 'innovation' is before identifying factors and conditions that contribute to successful growth of business. These conditions and factors need to be facilitated by the organisation. The leader of a business ultimately determines how the business will be done by the decisions he makes. Therefore, the role of the leader in relation to growth is further discussed and analysed. Even though all conditions are met and a suitable leader is in place, it does not necessarily mean that all innovations will be successfully implemented. The level of success is related to the impact and added value that an innovation has on the organisation and external environment. This essay describes how the impact and value
Transaction cost economics. Ronald Coase set out his transaction cost theory of the firm in 1937, making it one of the first (neo-classical) attempts to define the firm theoretically in relation to the market.
MANAGERIAL ECONOMICS COURSE ASSESSMENT 1 PREPARED BY MS. KWOK NA, CLARA STUDENT NUMBER: 8221037 ASSIGNMENT REFERENCE: ME/JULY11/1 BACKGROUND According to Ronald Coase, people begin to organize their production in firms when the transaction cost of coordinating production through the market exchange, given imperfect information, is greater than within the firm.1 Ronald Coase set out his transaction cost theory of the firm in 1937, making it one of the first (neo-classical) attempts to define the firm theoretically in relation to the market. One aspect of its 'neoclassicism' lies in presenting an explanation of the firm consistent with constant returns to scale, rather than relying on increasing returns to scale.2 Transaction cost economics (TCE), and more specifically the version of TCE that has been developed by Oliver Williamson (1975, 1985, 1993b), has become an increasingly important anchor for the analysis of a wide range of strategic and organizational issues of considerable importance to firms. Characteristics of TCE Contracting problem Although transaction cost economics maintains that all complex contracts are unavoidably incomplete by reason of bounded rationality, such incompleteness should not be confused with myopia. On the contrary, transaction cost economics maintains that intended rational economic agents are far-sighted - in that they will look
The dotcom bubble and the stock market fall in 2000-2001
"The dotcom bubble and the stock market fall in 2000-2001" OUTLINE . Introduction To introduce the topic, I'm going to address the importance of examining this crisis in detail and describe in a nutshell what actually happened. 2. Main body * The reasons of the dotcom bubble burst * Theoretical explanation of what happens during the financial bubble * What are the consequences of this particular event? 3. Conclusion Summary of the main points covered in my essay. How did the dotcom bubble burst contribute to the economic crisis of the 2008? Could we expect the similar crisis and how can it be prevented? What are the lessons that should have been learned from the dotcom crisis? INTRODUCTION When the global financial crisis occurred in 2008, both experts and general public started heated discussion as everyone was eager to identify the reasons for such a calamity. It is clear that nothing happens with no reason at all. Let's consider the famous speech1 of Ben Bernanke, who is the Chairman of the Federal Reserve System. In that testimony he tried to explain the causes of the recent financial and economic crisis to the Financial Crisis Inquiry Commission, highlighting the vulnerabilities in different sectors of economics. The idea of inadequate risk-measurement that he focused on is very important for us, as this particular issue makes the recent crisis akin to the