University of Maryland University College Nonfinancial Industry Discussion

Description

The Bureau of Economic Analysis provides profit data for various industries in the United States. 

Go to www.bea.gov

Click on Data > by Economic Account > National> Corporate Profits

Scroll down and Click on Interactive Data

Click on Table 6.16D. Corporate Profits by Industry”

In your initial response to the topic you have to answer all questions:

1. Based on the most-recent figures, which of the following categories of industry classifications has the greatest profits: 

Financial or nonfinancial

Manufacturing , transportation and warehousing, wholesale trade, or retail trade

Durable goods or nondurable goods

2.During the past years, which sectors had the largest and smallest percentage increase in profit?

3. Which sectors, if any, experienced losses?

4. What are the implications of the profit changes for expansion or contraction of the particular industries?

5. Reflection – the students also should include a paragraph in the initial response in their own words, using microeconomic terminology, reflecting on specifically what they learned from the assignment and how they think they could apply what they learned in the workplace or in everyday life.

You are expected to make your own contribution in a main topic as well as respond with value-added comments to at least two of your classmates. You are encouraged to respond to other students as well as to your instructor. 

Student 1 (Franklin)

Based on the most recent figures, which of the following categories of industry classifications has the greatest profits:

Financial or nonfinancial

Nonfinancial had the greatest profits with $1836.6 Billion

Manufacturing, transportation, and warehousing, wholesale trade, or retail trade

Manufacturing had the greatest profits with $555.6 Billion

Durable goods or nondurable goods

Non-durable goods

During the past years, which sectors had the largest and smallest percentage increase in profit?

Utilities had the largest percentage increase in profit during the past two years. Profits in 2020 Q1 it was $0.6 Billion and in 2021 Q4 profits were $19.9 billion (that represents an increase of 3,316%). Wholesale and Financial had similar percentage profits in the past two years. Wholesale had an increase in profit from 2002 Q1 to 2022 Q4 of 122% and Financial had an increase in profit of 124% during the same period of time.

Which sectors, if any, experienced losses?

Motor vehicles, bodies and trailers, and parts had a decline in profits from 2020 Q1 $7.9 billion to 2022 Q4 with a $(-2.7) billion that representing a -34.17% decrease in profits.

What are the implications of the profit changes for the expansion or contraction of the particular industries?

The implications might vary by industry, however, all industries must adequately prepare for contraction or expansion cycles. Customer demand increases during boom periods and decreases during recession periods, resulting in expansion and contraction. When the demand increases for any sector, the specific sector typically expands. Because of a favorable economic environment, growth becomes more prevalent as the demand increases, prompting an increase in overall output in terms of supplies, resources, and effort. This expansion helps the overall economic growth. When the demand decreases in an industry, it can lead to profit losses and a contraction in business. As a result, there will be a reduction in production, the number of employees, and many other necessary changes in order for businesses to adjust to the demand.

Reflection

Understating this assignment was a little bit challenging at first, because on a personal level before this assignment I had never paid attention to all the different sectors of the market. However, after reading the report on corporate profit, I was able to see how economists and people that make financial decisions use these reports to make very important decisions that could affect all of us.

Student 2 (Mario)

1. Based on the most-recent figures, which of the following categories of industry classifications has the greatest profits:

Financial or nonfinancial: Nonfinancial
Manufacturing , transportation and warehousing, wholesale trade, or retail trade: Wholesale trade
Durable goods or nondurable goods: Durable goods

2.During the past years, which sectors had the largest and smallest percentage increase in profit? Largest Percentage: Wholesale trade. Smallest Percentage: Electrical equipment.

3. Which sectors, if any, experienced losses? Motor vehicles, bodies and trailers and parts

4. What are the implications of the profit changes for expansion or contraction of the particular industries? The implications are the profit seen at the end of the quarter, if the industry is losing money, they to decrease spending.

What I learned from this assignment is that things aren’t what they seem. I assumed that because of the rising cost of vehicles nowadays, the demand would be very high. However, the car industry’s numbers say otherwise.

Explanation & Answer: 1 Page
Tags: Transportation categories nonfinancial industry
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