XYZ Company should understand the roles played by macroeconomics and microeconomics in its success. Macroeconomics is majorly concerned with the overall functioning of the economy. Macroeconomics not only deals with the entire economy on how to improve but also with individuals and businesses. Microeconomics specifically focuses on the roles consumers and businesses play in the whole economy, with specific concern on how two groups make decisions for the success of their businesses (Issah & Antwi, 2017). The report aims at identifying the role of economics in the success of the organization.
Elasticity is one of the economic specifics that measures the aggregate quantity demanded change for the commodities while services relative to the price movement for the products and services (Chaudhary et al., 2020). The products can either be elastic or inelastic. Elastic goods, their quantity demanded varies drastically as the price increases or decreases. Inelastic products, their demand changes very slightly when the price fluctuates. Understanding that the business's products and services are elastic or inelastic is integral to its success (Chaudhary et al., 2020). Companies with high elasticity ultimately compete with other organizations on price and are required to have high sales transactions.
Consumer choice is another species of economics the business success for it aims to make a better decision on the products offered to the customers. By identifying customer preference, developing the audience research tool helps make the right decision in the company. A company produces goods and incurs expenses such as labor and material, among others when providing products to consumers (Oliveira & Silva, 2018). A company should operate in low production cost to gain high profit from sales revenue.
Demand and supply are significant to the company's owners when carrying out their activities. Supply is the total amount of the product and service available over a given time to consumers. The demand acts as a measure of consumers' desire to pay for specific goods and services (Gölgeci et al., 2019). They are both economic forces that influence each other. They are essential for the business for they impact the price of consumer goods and services within the organization and the entire economy.
Aggregate supply and aggregate demand are macroeconomic models based on the fundamental relationship between businesses, financial markets, and households (Auboin, 2018). This model explains supply and demand in terms of quantity and price. It also describes how each change in response to the other factors is held constant. The model also has several variables, such as inflation and interest rates, which affect aggregate consumers and organizations. This model focuses on the variables that can be effectively modeled to make predictions in the organization to improve the quality of goods offered.
Macroeconomics plays a significant role in the success of the business. Macroeconomics relates to how the entire economy functions. Organization management or owners for the success of their businesses and improving their operations require examining the current macroeconomic situation to determine its service, and improvement is the best idea (Issah & Antwi, 2017). Macroeconomics enables one to carefully consider the factors that are to be found in deciding to set up a new one or expand an existing business. The rate of unemployment is one of the considerations to be examined. The employees are to be hired at lower wages to improve the profit and pay attention to inflation, which is the increased price in the economy. It also facilitates the purchasing decision of a customer.
In conclusion, XYZ Company should examine the specifics of economics for its success. Macroeconomics and macroeconomics assist when deciding for the business, to increase output
Auboin, M. (2018). The falling elasticity of global trade to economic activity: testing the demand channel. https://papers.ssrn.com/sol3/papers.cfm2
Chaudhary, I., Subramanian, G., & Shankar, V. (2020). Role of elasticity and solvent viscosity on the center mode instability in pipe Poiseuille flow of Oldroyd-B fluids. Bulletin of the American Physical Society, 65. http://meetings.aps.org/Meeting/MAR20/Session/M20.7
Gölgeci, I., Karakas, F., & Tatoglu, E. (2019). Understanding demand and supply paradoxes and their role in business-to-business firms. Industrial Marketing Management, 76, 169-180. https://www.sciencedirect.com/science/article/abs/pii/S0019850117304972
Issah, M., & Antwi, S. (2017). Role of macroeconomic variables on firms’ performance: Evidence from the UK. Cogent Economics & Finance, 5(1), 1405581. https://www.cogentoa.com/article/10.1080/23322039.2017.1405581
Oliveira Duarte, P. A., & e Silva, S. C. (2018). The role of consumer-cause identification and attitude in the intention to purchase cause-related products. International Marketing Review. https://www.emerald.com/insight/content/doi/10.1108/IMR-04-2018-0159/full/html.
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