Pick any one topic for your paper. This term paper covers 15% of your course grade.
The paper should be 6 pages long (including Title page, bibliography, graphs, tables etc.). It should be typed double-spaced in Times New Roman, font size 12 following the APA style with 1-inch margin on all sides. Don’t forget to include a title page at the beginning and a bibliography at the end of your paper. Discuss the issue in your paper as an economist. Upload your paper as MS Word document on Blackboard.
Title 5 points
Page numbering 5 points Correct labeling of Figures, Tables
(Including source) Content Bibliography
5 points 20 points 5 points
APA style: https://apastyle.apa.org/style-grammar-guidelines/paper-format
How America’s talent wars are reshaping business – the labour shortages are forcing firms to get creative
The Economist | Feb 5, 2022, edition
Summary: Dcl logistics, like so many American firms, had a problem last year. Its business, fulfilling orders of goods sold online, faced surging demand. But competition for warehouse workers was fierce, wages were rising and staff turnover was high. So Dcl made two changes. It bought robots to pick items off shelves and place them in boxes. And it reduced its reliance on part-time workers by hiring more full-time staff. “What we save in having temp employees, we lose in productivity,” explains Dave Tu, Dcl’s president. Full-time payroll has doubled in the past year, to 280. Paycheques of everyone from McDonald’s burger-flippers to Citi group bankers are growing fatter. This
goes some way to explaining why profit margins in the S & P 500 index of large companies, which have defied gravity in the pandemic, are starting to decline. Explain how this tug-of-war between the employers and employees is affecting the US labor market in terms of elasticity of supply and demand of skilled labors and their wages and changing the way of doing business in this country. Are we seeing similar trends in the European, Asian or South American labor markets?
Oil Tops $130 a Barrel as Russian Attacks Escalate WSJ | By Ryan Dezember | March 6, 2022
Summary: The biggest premiums on record are being paid for barrels of oil to be delivered now rather than later. Prices for April delivery of crude oil have shot up since Ukraine was invaded by Russia and buyers began to shun Russian oil exports. The main U.S. crude oil price recently exceeded $110 a barrel for the first time in more than a decade.
Because the supply for many products is relatively inelastic in the short run, an increase in demand will result in a greater increase in price and a lower increase in quantity than over a longer time period. Holding other factors constant, the demand for a product will be more inelastic when there are no good substitutes for the product. With this simple theory in hand, discuss how consumer behavior, labor market, and the inflation in the US will be affected due to the escalating Russia-Ukraine war.
The New Sticker Shock
WSJ | By Mike Colias Nora Eckert | February 26, 2022
Summary: As supply chain problems prolong a shortage of new automobiles for a second year, customers face near-empty dealer lots, high prices and long waits to buy new cars. Although automobile manufacturers discourage dealers from charging more than their cars’ sticker prices, many dealers say they have to be realistic about what the market will bear. In extreme cases, dealerships have charged as much as $40,000 above the manufacturer’s suggested retail price (MSRP) for some luxury cars.
Product shortages cause prices to rise and product surpluses cause prices to fall in the free market. Under the current scenario of supply-chain crisis in the US, discuss the
general production and consumption opportunity cost (highest-valued alternative given up to engage in an activity) likely to have an impact on the US GDP for the coming years.
Shoppers Are Caught Off Guard as Prices Change More Often WSJ | By Charity L. Scott | February 4, 2022
Summary: More everyday items are being priced like airline tickets where sticker prices are changed within hours or days. Retailers say this is a reaction to changes in costs and continuing product shortages caused by the Covid-19 pandemic. The changes occur online as well as offline.
Menu costs are costs firms incur when they change their prices. Menu costs may cause some prices to be “sticky.” In the article Brian Elliott, a partner at the management consulting firm McKinsey & Co. stated: “As a retailer, what I really care about is loyalty…If the customer feels ripped off, they’re not going to come back to my store.” Briefly explain why a market shortage may be allowed to persist because a retailer places a priority on maintaining the loyalty of its customers. Which would benefit consumers more: (a) a retailer allows a product shortage to persist, or (b) the retailer increases the price of a product to eliminate the shortage? Discuss how rising prices are hurting the consumers’ purse and cost of living.
Taking stock as America moves into a new phase of the pandemic
The Economist | March 12th 2022 edition
Summary: Two years ago on March 11th, the World Health Organization declared covid-19 a pandemic. Americans are eager to leave the wretchedness behind them. Polls suggest concern about covid is declining. Mask-wearing has waned. On March 26th, Hawaii will become the final state to drop its indoor mask mandate, and the Centres for Disease Control and Prevention (cdc) now recommends masks only for the 7% of Americans living in high-risk counties.
The introduction of vaccines and now booster shots is reviving the economic activities in every country. Which industries will thrive, and which ones are likely to perish under the new norm of doing business in the post-pandemic era?