Economics Analysis Paper Three 2
Abstract.
This study aims to identify some of the macroeconomic variables and analyze the impact of these variables on the demand and supply of Toyota automobile vehicles in the U.S. The paper includes four to five years historical data of these variables accumulated and samples for this analysis. This analysis will also look at the long term correlation of these variables with Toyota car sales. Results shows that a slowdown in U.S income growth could short-circuit the surge in consumer spending including the sales of vehicles manufactured by the U.S automotive manufacturers, such as Toyota Motor Corporation
Macroeconomic Analysis
Economics use variety of models to explain how the U.S national income is determined, including the aggregate demand-aggregate supply (AD-AS) model. The model is taken from the basic circular flow concept that explains how income flows between household and firms. The aggregate demand curve, labeled AD shown below is a curve that shows the relationship between the price level and the quantity of real GDP demanded by households, firms and the government (Brue, McConnell, Flynn, 2014). It consist of the amount of households plans to spend on goods (C), plus planned spending on capital investment (I), plus government spending (G), plus export (X), minus import (M) from abroad. The standard equation is
AD = C + I + G + (X – M)
The short-run aggregate supply curve shows the relationship in the short-run between the price level and the quantity of real GDP supplied by firms. In the short-run, the real GDP and price level are determined by the interaction of the aggregate demand curve and the short-run aggregate supply curve. As shown below the demand curve is a visual representation of the behavior of buyers in a market while the supply curve is a visual representation of the behavior of sellers in a market. At only the equilibrium price will we have suppliers willing and able to bring to the market
This study aims to identify some of the macroeconomic variables and analyze the impact of these variables on the demand and supply of Toyota automobile vehicles in the U.S. The paper includes four to five years historical data of these variables accumulated and samples for this analysis. This analysis will also look at the long term correlation of these variables with Toyota car sales. Results shows that a slowdown in U.S income growth could short-circuit the surge in consumer spending including the sales of vehicles manufactured by the U.S automotive manufacturers, such as Toyota Motor Corporation
Macroeconomic Analysis
Economics use variety of models to explain how the U.S national income is determined, including the aggregate demand-aggregate supply (AD-AS) model. The model is taken from the basic circular flow concept that explains how income flows between household and firms. The aggregate demand curve, labeled AD shown below is a curve that shows the relationship between the price level and the quantity of real GDP demanded by households, firms and the government (Brue, McConnell, Flynn, 2014). It consist of the amount of households plans to spend on goods (C), plus planned spending on capital investment (I), plus government spending (G), plus export (X), minus import (M) from abroad. The standard equation is
AD = C + I + G + (X – M)
The short-run aggregate supply curve shows the relationship in the short-run between the price level and the quantity of real GDP supplied by firms. In the short-run, the real GDP and price level are determined by the interaction of the aggregate demand curve and the short-run aggregate supply curve. As shown below the demand curve is a visual representation of the behavior of buyers in a market while the supply curve is a visual representation of the behavior of sellers in a market. At only the equilibrium price will we have suppliers willing and able to bring to the market
References: Benjamin, D. (Volume 17. No.3. Fall 1999). Voluntary Export Restraints on Automobiles. Retrieved February 28, 2014 from: http://perc.org/articles/voluntary-export-restraints-automobiles Brue, S Doucet, J. (2010). The automotive Industry (Macroeconomic Analysis). Retrieved February 26, 2014 from: http://jennadoucet.wordpress.com/2010/03/14/21/ Helmut, H National Automobile Dealers Association (NADA, 2011). State of the industry report. Retrieved February 25, 2014 from http://www.nada.org/NR/rdonlyres/1B512AC7-DCFC-472C-A854-6F5527931A2F/0/2013_NADA_Data_102113.pdf Nkomo, T