Re:Importance of Macroeconomic Variables There are three main variables that are very important to our corporation’s economic performance. These variables are the “real” Gross Domestic Product, the unemployment rate, and the Consumer Price Index. It is very important for our company to have knowledge and a good understanding of these concepts in order to be more profitable.Knowledge of the Gross Domestic Product is essential in setting our prices. The GDP is the best indicator to show us how viable the market is for our product. A low GDP would indicate that prices across the board are low. This would be a signal for our company to keep are prices the same, or even possibly lower them. A high GDP would signal that the economy was right for an increase in our prices, depending upon what are competition is doing. The GDP is the best indicator of economic growth.It is also necessary for us to watch what the unemployment rate is nationally. A low unemployment rate would mean that there is a reduced labor force for us to choose from. This would most likely cause salaries for qualified individuals to rise. A high unemployment rate would allow us to maintain present salary figures, and in some cases lower certain salaries. Allowing us to reduce our input costs, thus making our company more profitable.Knowing about the Consumer price index is also very important to our company. The CPI allows us to keep track of the rate of inflation. This is very important in order to be able to set are price levels at a point were they are comparable to our input costs. When the CPI goes up the rate of inflation goes up, which causes our production costs to also go up. In order to stay profitable, we must be able to adjust our prices to match the rate of inflation....
