ECON195 – Macroeconomics

ECON195 – Macroeconomics

Portfolio Project Directions and Rubric

This Portfolio Project is worth 20% of your grade.

View this video for an introduction and overview of the Portfolio Project: ECON195 Portfolio Project Overview

Completing this Assessment will help you to meet the following:

Course Outcomes

• Estimate the effects of supply and demand theory on market forces, and government policies.
• Apply macroeconomic theory and basic principles to economic data sets.

Institutional Outcomes

• Relational Learning – Transfer knowledge, skills, and behaviors acquired through formal and informal learning and life experiences to new situations.
• Thinking Abilities – Employ strategies for reflection on learning and practice in order to adjust learning processes for continual improvement.
• Quantitative and Scientific Reasoning – Follow established methods of inquiry and mathematical reasoning to form conclusions and make decisions.

Directions
In this project, you will apply and analyze the impact of market forces relative to supply and demand model. In scenario 1, you will use Excel to determine initial market equilibrium and then examine a number of changes of equilibrium when economic conditions change. In scenario 2, you will use Excel to calculate the impact market impact of government policy. In the final submission, you will summarize your findings from the two scenarios, what they mean, and their application. 

Although there are many market models, including monopolies and oligopolies, this project will apply the perfectly competitive market model. There are few perfectly competitive markets, but the model is a good starting point in an analysis and comparison because it represents production and allocation efficiency as well as maximizes consumer surplus and economic welfare. The assumptions upon which this model is built include:

1.         Many buyers and sellers

2.         Standardize product

3.         All parties have full information

4.         No transaction costs

Review the entire project, including the rubrics, before you begin so that you understand all the requirements, how you will be assessed, and due dates. The Excel template provided must be used for Scenario 1 and 2. This will aid in not only completing the assignment but also help ensure that all required parts are completed.  For your final submission, the Word template provided must be used to ensure all project requirements are met.

Deadline
Deliverable items for the Portfolio Project will be required at different points during the course. Details for each submission are included below in the Deliverable Descriptions.

Module 2: Scenario 1 – Impact of Market Forces on Supply & Demand

•          See Tracking Calendar

Major weather events have the ability to negatively impacted large geographical areas. This is something that most have lived through, and have find it frustrating when prices increase and/or products and services are hard to purchase. Damage caused storms will often lead to an increase in demand for products and services to repair the damages.  Not only will a major weather event drive up the demand for some products and services, but it also impacts those businesses that supply those needed products and services.  Some of these frustrations have led to public outcry about price gouging. While some price gouging might exist, an analysis of supply and demand provides answers to what is happening in the market. 

In this scenario a major storm has caused large scale damage to a coastal area you are a nursing home administrator at. The corporate auditor wants justification for the increased cost of supplies to repair the nursing home damaged in the storm. Only one product will be analyzed – construction screws. Complete each part of this scenario using the Excel template provided. This will be part of your response to the auditor.  

View this video for help in completing scenario 1:   Scenario 1 – Impact of Market Forces on Supply & Demand

Table 1: Data for Scenario 1

Part A:

Begin by copying the data from Table 1 to the Excel template. Using the data provided, insert a chart (Scatter with straight lines and markers) in the first blank box that includes the market supply and demand curves. The x-axis is to be labeled Quantity in Boxes and the y-axis Price per Box. Label the equilibrium A. Add a legend and chart title (Part A: Market for Construction Screws) to the chart.  Once the original chart is complete, copy it into the remaining three boxes.

Part B:

As a result of a major weather event, the demand for construction screws increases. In the New, Qd column, add 800 to each value in the Qd column.  Name the second chart Part B (change the A to a B) and add the new demand curve to the chart. Label the new equilibrium B.

Part C:

As the result of the of a major weather event, the supply of construction screws decreases. In the New Qs column, subtract 800 from each value in the Qs column. Name the third chart Part C (change A to C) and add the new supply curve to the chart. Label the new equilibrium C.

Part D:

It is seldom that market conditions only impact one of the curves at a time. Name the fourth chart Part D and add both the New Qd and New Qs to the chart. Label the new equilibrium D.  To complete Part D, correctly add the equilibrium labels from Part A-C.

Module 3: Scenario 2: Market Impact of Government Policy on Supply & Demand

•          See Tracking Calendar

Supply and demand analysis can be used not only to determine the market clearing price and quantity but also to estimate the impact of government policies and regulations. In this scenario, the local market has been impacted by the offshoring of production. With the loss of higher paying production jobs, displaced workers were forced to take on lower paying services jobs. With the decrease in income, the demand for housing decreased, but the demand for rental units increased.  The data in Table 2 represent the current market for rental units. In order to help struggling families, the local government passed a rent control law that sets the maximum rent that can be charged at $2,000 per month. Before the mayor acts on the Common Counsel resolution, she has asked you as the Chief of Staff to prepare a brief document on the impact of imposing rent control

View this video for help in completing scenario 2: Scenario 2 – Government Policy Impact on the Market Using Supply & Demand

Table 2: Data for Scenario 2

Part A:

Using the same template used for Scenario 1, begin Scenario 2 by importing the data from Table 2 into the template. In the box provided, insert a chart (Scatter with straight lines and markers) and title the chart Market for Rental Units. Properly label the axis and include a legend.

Part B:

Fill in the equilibrium table provided and label equilibrium E.

Part C:

Complete the price ceiling table and, using the values from the table, insert a price ceiling line to the original chart.

Module 5: Final Submission to ePortfolio

•          See Tracking Calendar

This is the final submission of your Portfolio Project.  Incorporate instructor feedback and make any needed corrections to the Excel scenarios before completing the final submission document.

In this submission, you will use the final charts in Scenarios 1 & 2 as the bases to report out your findings and analysis. A Word template has been provided for the final submission, which can be found in the Module 1 folder – Portfolio Project Directions and Rubrics and the Course Assessment tab. As you work through the final document, make sure you delete the yellow highlight instructions prior to submitting the document for grading.

View this video for help in completing the final submission document: ECON195: Portfolio Project Submission to ePortfolio

Upload your Portfolio Project to the Program Outcome in your ePortfolio listed below.  Use the following naming convention:  LastName ECON195 ePortfolio:

• “Institutional Outcome”
  • Quantitative and Scientific Reasoning – Follow established methods of inquiry and mathematical reasoning to form conclusions and make decisions.

For directions on how to upload your project to your ePortfolio, please see Student Resources in Blackboard on the navigation pane.

Module 8: Reflection

•          See Tracking Calendar

In modules 2 and 3, you used Microsoft Excel to plot demand and supply curves to find equilibrium price and quantity. In module 5, you reported your findings and analysis of the two scenarios. In the process of completing the various project components, you had the opportunity to see the impact of market forces on supply and demand.  You also examined the impact of government policies on the market. In a minimum of 150 of your own words and in a Word document, address the following prompt in your reflection:

• Identify, and explain three lessons learned (takeaways) by completing the portfolio project that applies to your program, personal life, and/or your career.
• Briefly explain how you met the requirements of the Quantitative and Scientific Reasoning Institutional Outcome.

As you draft your reflection to refer to the Portfolio Project Reflection grading rubric listed below.

Upload and submit your final reflection in Blackboard.

For specific grading information, please refer to the Portfolio Project Grading Rubrics listed below.

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