Macroeconomics With Operations in More Than 200

Macroeconomics With operations in more than 200 countries and having a significant share of the market locally, the Coca-Cola Company today remains one of the most reputable beverage and soft drink makers in the world. Mainly, the company offers for sale a wide range of still and sparkling beverages with its most popular products being Coca-Cola, Sprite, Fanta and Diet Coke. Currently, the company has a global workforce of about 139, 600.

The Coca-Cola Company: Application of Economic Ideas In my own opinion, the company would make an interesting case for economic analysis based on a number of things. To begin with, the performance of the company is largely dependent on a number of macroeconomic factors including fiscal as well as monetary policy. For instance, such policies could have profound effects on inflation and based on the nature of the products the company offers for sale i.e.

consumer goods, the demand of the same could be affected as the purchasing power of consumers is shaved off by raising costs. Secondly, the company would be an interesting focus for my economic ideas and their application as information about its operations, profitability as well as competitiveness is readily available based on the fact that the company is a publicly traded entity. In that regard, finding the relevant data about the firm from a wide range of sources including SEC would be much easier.

Macro-economics and Coca-Cola Based on the relative size of the firm, the industry it operates in as well as the nature of products it offers for sale, the Coca-Cola Company is affected in more than one way by macro-economic actions as well as policies. When it comes to macroeconomic actions that could affect the company; we could take into consideration moves to increase or lower interest rates and secondly, increase or decrease of taxation rates. According to Taylor (2006), the real interest rate and investment have a negative relationship.

It therefore follows that if interest rates are high, Coca-Cola would find it costly to borrow and this would slow down planned investments. The reverse is true. In regard to tax, the decrease of the same leads to increased real incomes of the Company while increases in taxation inform the decrease of the company's real income. However, it is important to note that the reverse is true for the government.

With an increase in tax rates, the government rakes in more in terms of real income while a decrease of the tax rates brings about a decrease in real income for the government. The Big Ideas: Their Application Idea 1 "Choices involve tradeoffs- we always give something up to get something else" By their very nature, resources are in most cases scarce. A company like coca cola has therefore to make a tradeoff when it comes to the utilization of its monetary resources.

It essentially has to give up something so as to get more of another. A typical scenario in this case would be where the company needs to motivate its employees by hiking their salaries while at the same time seeking to sustain its growth by investing in emerging markets. If it does not have the funds to carry on with these two undertakings at the same time, the company would have to give up one so as to pursue the other. Idea 4.