ECO306 Dr. Berdell: Macroeconomic Outlook and Theory Review I) Topic Present your analysis of the near-term prospects for the US economy.  Which factors and policies will be the most important determinants of the future course of the economy? Forecasts of the economy are always based on theoretical and methodological presuppositions; hence this paper calls for your reasoned personal opinion.  To construct and support that opinion you will need to identify and discuss the relevant data as well as set out and justify the theoretical perspective from which you are viewing the data.  Your choice of which theoretical perspective(s) to adopt will likely depend upon the type of problem you are analyzing. The following section presents the criteria by which papers will be assessed. Section III emphasizes the importance of proper references and avoiding plagiarism. Section IV sets out a variety of important variables to consider and some sources where the data and associated commentary may be found.  Section V discusses how you can use the Keynesian macro-econometric FairModel. II Evaluation Criteria 1. Clarity of Forecast and Cyclical Positioning a. Is there a clear forecast table in the appendix and does the paper make good use of it? b. Has the economy been expanding/contracting? c. What are the chances that it is presently at a turning point? 2. Identification and Depth of Sources a. Are sources acknowledged and properly cited? Does the bibliography or list of references coherently and consistently document these sources? b. Is there a mix of sources from original gov. releases, commentary from the press, and academic theories and research? 3. Coverage and Interrelation of Sectors a. Is there coverage of: i. leading-coincident indicators ii. labor market conditions iii. GDP growth and its components iv. indicators of inflation and borrowing costs v. productivity and profitability measures vi. exchange rates and external linkages b. How clearly and concretely are developments in these parts of the economy are interrelated? 4. Use of Competing Theories, Models and Forecasts a. Are the contending theoretical approaches covered in the text considered? b. Are additional required/recommended sources utilized? c. Are private or public sector forecasts presented? d. Are FairModel or other model results considered? e. Are the structure and assumptions of the Fairmodel presented? 5. Cohesion, Coherence and Innovation of the Analysis a. Does the work elaborate a consistent thesis or does each section seem detached and without a unifying theme? It is clearly and well written? b. Are there innovative aspects of the analysis or its presentation? III) Length and Proper References The paper should contain 6-10 pages of text, double spaced.  You may either insert or attach at the end a variety of tables and graphs you think important. These tables and graphs must be numbered and discussed in the text.  Never attach or insert an obj ...

1. ECO306 Dr. Berdell: Macroeconomic Outlook and Theory
Review
I) Topic
Present your analysis of the near-term prospects for the US
economy. Which factors and policies will be the most
important determinants of the future course of the economy?
Forecasts of the economy are always based on theoretical and
methodological presuppositions; hence this paper calls for your
reasoned personal opinion. To construct and support that
opinion you will need to identify and discuss the relevant data
as well as set out and justify the theoretical perspective from
which you are viewing the data. Your choice of which
theoretical perspective(s) to adopt will likely depend upon the
type of problem you are analyzing.
The following section presents the criteria by which papers will
be assessed. Section III emphasizes the importance of proper
references and avoiding plagiarism. Section IV sets out a
variety of important variables to consider and some sources
where the data and associated commentary may be found.
Section V discusses how you can use the Keynesian macro-
econometric FairModel.
II Evaluation Criteria
1. Clarity of Forecast and Cyclical Positioning
a. Is there a clear forecast table in the appendix and does the
paper make good use of it?
b. Has the economy been expanding/contracting?
c. What are the chances that it is presently at a turning point?
2. Identification and Depth of Sources

2. a. Are sources acknowledged and properly cited? Does the
bibliography or list of references coherently and consistently
document these sources?
b. Is there a mix of sources from original gov. releases,
commentary from the press, and academic theories and
research?
3. Coverage and Interrelation of Sectors
a. Is there coverage of:
i. leading-coincident indicators
ii. labor market conditions
iii. GDP growth and its components
iv. indicators of inflation and borrowing costs
v. productivity and profitability measures
vi. exchange rates and external linkages
b. How clearly and concretely are developments in these parts
of the economy are interrelated?
4. Use of Competing Theories, Models and Forecasts
a. Are the contending theoretical approaches covered in the text
considered?
b. Are additional required/recommended sources utilized?
c. Are private or public sector forecasts presented?

3. d. Are FairModel or other model results considered?
e. Are the structure and assumptions of the Fairmodel
presented?
5. Cohesion, Coherence and Innovation of the Analysis
a. Does the work elaborate a consistent thesis or does each
section seem detached and without a unifying theme? It is
clearly and well written?
b. Are there innovative aspects of the analysis or its
presentation?
III) Length and Proper References
The paper should contain 6-10 pages of text, double spaced.
You may either insert or attach at the end a variety of tables
and graphs you think important. These tables and graphs must
be numbered and discussed in the text. Never attach or insert
an object which you do not talk about in the paper! Do
remember that I expect a list of references at the end of the
paper, and proper citation of material throughout.
I am not greatly concerned about which style of references you
use so long as it is a well-respected standard and consistently
used. An easy style of references is Turabian Author Date.
DePaul’s Writing Center
http://condor.depaul.edu/writing/writers/citations.html has a
link to a page for the Turabian style. On this page you need to
click the Author Date Tab
http://www.press.uchicago.edu/books/turabian/turabian_citation
guide.html
You must use quotation marks or indentation to indicate text
written by others and avoid plagiarism:.
“..a major form of academic dishonesty involving the

4. presentation of the work of another as one's own. Plagiarism
includes but is not limited to the following:
a. The direct copying of any source, such as written and verbal
material, computer files, audio disks, video programs or musical
scores, whether published or unpublished, in whole or part,
without proper acknowledgement that it is someone else's.
b. Copying of any source in whole or part with only minor
changes in wording or syntax, even with acknowledgement.
c. Submitting as one's own work a report, examination paper,
computer file, lab report or other assignment that has been
prepared by someone else. This includes research papers
purchased from any other person or agency.
d. The paraphrasing of another's work or ideas without proper
acknowledgement.
Plagiarism, like other forms of academic dishonesty, is always a
serious matter. If an instructor finds that a student has
plagiarized, the appropriate penalty is at the instructor's
discretion. Actions taken by the instructor do not preclude the
college or the university from taking further punitive action
including dismissal from the university” (DePaul Student
Handbook).
In this assignment you GAIN points by citing a wide range of
authors and sources so plagiarism would be totally
counterproductive! Do indeed mention discussions you have
had with class mates if they have influenced your views or if
you are sharing material. Each student must write their own
paper.
IVA) Some Variables and Sources to ConsiderLeading
Indicators
Review the behavior of the leading, lagging and coincident
indicators.
Source: The Conference Board
‘Nowcasting” indicators of GDP: Economy.com,

5. Chicago FRB CFNAI
https://www.chicagofed.org/publications/cfnai/index
Atlanta FRB ‘GDP now’
https://www.frbatlanta.org/cqer/research/gdpnow.aspx?panel=1
The Labor Market
Review the behavior of the unemployment rate, employment
rate, and labor participation rate.
Sources: "THE EMPLOYMENT SITUATION" monthly by the
Bureau of Labor Statistics (BLS http://www.bls.gov/). Also
available via Economy.com US Economic Indicators.
The Atlanta FRB has a very good visual presentation of labor
market indicators
https://www.frbatlanta.org/chcs/wage-growth-
tracker.aspx?panel=1
https://www.frbatlanta.org/chcs/labor-market-distributions.aspx
Productivity
Review the behavior of productivity and its relation to output
and employment growth.
Sources: The BLS has excellent resources on productivity.
www.bls.gov/bls/productivity.htm Covers labor productivity
and is closely related their labor costs page that will appear
below.
www.bls.gov/mfp/home.htm Covers multifactor productivity.
The San Francisco FRB http://www.frbsf.org/economic-
research/indicators-data/total-factor-productivity-tfp/ for real
time estimates of total productivity growth. (Tracking
productivity in real time is unfortunately a very problematic
undertaking, for a discussion see
https://www.newyorkfed.org/research/current_issues/ci12-
8.html)
Output and Demand Components
Review the growth of output and its components: C, I, G, (X-
IM).
Sources: The all-important "GROSS DOMESTIC PRODUCT"

6. report from the Bureau of Economic Analysis (BEA
http://www.bea.gov/). Also available via Moody’s
Economy.com US Economic Indicators.
The Atlanta FRB “now casts” this table for the current quarter
as GDPNow.
https://www.frbatlanta.org/cqer/research/gdpnow.aspx?panel=1
The New York Fed also has a GDP ‘now cast’ but with less
detail than the Atlanta Fed
https://www.newyorkfed.org/research/policy/nowcast
Inflation
Review the movement of the GDP deflator and Personal
Consumption Expenditure deflator found in the "GROSS
DOMESTIC PRODUCT" report.
Review the movement of the "Consumer Price Index". Also
available via Economy.comUS Economic Indicators.
The San Francisco FRB has a good inflation site
http://www.frbsf.org/economic-research/indicators-data/pce-
personal-consumption-expenditure-price-index-pcepi/
Review the movement of the "Employment Cost Index" from the
BLS. Also available via Economy.com US Economic Indicators.
Exchange Rates and International Payments
Review the movement of the US Current Account See the BEA's
"Balance of Payments" report (BEA http://www.bea.gov/).
Review the movement of $ Exchange Rates. See The FRED
data base under exchange rates, especially the Trade Weighted
Exchange Rates found at the end of the list.
Monetary Policy
Review the movement of the FRB's Discount Rate and "Selected
Interest Rates".
You may wish to consult the "Summary of Commentary on
Current Economic Conditions (Beige Book)" and "Federal Open
Market Committee Meeting Minutes".
(See
http://www.federalreserve.gov/monetarypolicy/default.htm)

7. Fiscal Policy
Review the contribution of G (government spending) growth to
the growth of output. See the GDP reports table 2 which tells us
the contributions of different types of spending to GDP growth.
To look at the issue of the Full Employment Budget Deficit and
the effect of automatic stabilizers go to the Congressional
Budget Office www.cbo.gov. Look for their ‘Update to the
Budget and Economic Outlook’ it has a section examining the
“Deficit or Surplus With and Without CBO’s Estimate of
Automatic Stabilizers, and
Related Estimates, as a Percentage of Potential Gross Domestic
Product”. The most influential think tank following fiscal
policy is Brookings:
https://www.brookings.edu/topic/federal-fiscal-policy/
IVB) Sources Mentioned Above and Other Handy Links
Economy.com (used to be called Dismal Scientist.) Go to the
library databases and find Economy.com . In addition to their
economic commentary (which you can search for say "GDP
report" or "productivity" ) it is worth examining their FRB
links, Taylor Rule calculator, and Stock Market Calculator.
They have a companion site FreeLunch.com that allows you to
graph many variables not available via the Conference Board.
FRED The Federal Reserve Board's Economic Data Base.
http://www.research.stlouisfed.org/fred2/
Our text mentions this rather frequently at the ends of chapters
and it is an excellent source verymuch like Economagic.
Look at both and see which one you prefer.
FairModel (http://fairmodel.econ.yale.edu/ )
A large but very standard Keynesian macro-econometric model.
You can use it to produce a forecast of the economy and to
examine the impact of changes in monetary and/or fiscal policy.

8. You can also examine the impact of oil price shocks etc.
Discussed below.
CBO http://www.cbo.gov/
For the Government's Economic Forecast for the next 10 years
see the CBO. The Congressional Budget Office prepares the
forecasts of the NAIRU, Y potential and Y the underlie the
President's Budget. Their current forecast for the US economy
is available from their home page. The methodology behind
these forecasts is discussed in some detail in documents found
in the "Budget and Economic Outlook" section of their
publications.
BEA http://www.bea.gov/
The Bureau of Economic Analysis generates the GDP report.
Economic Trends http://www.clevelandfed.org/Research/
The Cleveland FRB's overview of the US economy.
Many or perhaps all of the links mentioned above are listed on
the American Economic Association's Resources for Economists
web page devoted to Forecasting and Consulting
http://rfe.org/V The Keynesian FairModel as a point of
reference:
There is a very well known Keynesian model of the US
economy that traces its intellectual roots back to the Keynesian
heydays of the 1950's and 60's at Yale University. It is Ray
Fair's FairModel at http://fairmodel.econ.yale.edu/ . We will
discuss its structure and equations when we cover chapters 11-
15 of the text. I suggest that you refer to its key equations in
your paper, and indicate why a classical economist would not
agree with their specification. The model generates a 'base'
forecast of the US economy's growth, unemployment, financial
balances and a host of other variables that you need not
consider. You should know what the model's forecast is and
why you agree or disagree with it.

9. You may also use the Fair Model to indicate what will happen
to the economy under different scenarios (for instance what will
happen if monetary or fiscal policy is altered.
Updated instructions on running the fairmodel will be posted in
D2L.
VI Generic Outline
This is a generic outline. It is typical for the economic outlook
papers written by banks and other institutions year in and year
out. You should deviate from it in order to emphasize issues
that are especially important right now or to accommodate one
or two issues that caught your interest and you want to
emphasize. You should find some place to explain whether you
are using a Keynesian or a Classical approach to understanding
the economy. Perhaps you have decided to draw from both
traditions. You could reorder the material and insert a section
or two. You obviously can’t write about everything that I
mention in the generic outline, but you should say something
that speaks to the major headings: Labor, Demand, Financial
Markets, Supply and International. The main text (sections I to
VI below) should be 5-7 double spaced pages. Only attach
graphs and tables at the end that you talk about in the paper.
Attaching random material not discussed in the body of the
paper will lower the paper grade.
I) Introduction: Where is the US economy in the cycle?
(Starting an expansion? Ending an expansion? When was the
last “turning point” of the US economy?) Are the forecasts for
the US economy split between optimists and pessimists, or do
they all seem to say pretty much the same thing? What growth
rate do you think is likely for the US economy in the forecast
period? (This will be based on your reading and synthesis of
professional forecasts.) What are the key issues that you want

10. to draw special attention to in the sections that follow?
II) Labor Market Developments: What has been happening to
the growth of jobs and wages? (Strong? Weak?) What are
forecasters expecting? What about unemployment and
participation rates? Are there some other important things
about the labor market you encountered that you want to note?
III) Demand. The GDP report, especially table two
“Contributions to GDP growth”, will tell you exactly which
sources of demand have accounted for recent growth. The
Atlanta FRB GDPNow forecast (or Nowcast) will tell you what
seems to happening right now. The Dismal Scientist will also
do this and forecast into the future. The forecast sources
document on D2L has additional sources. Have you read
anything about why particular components of spending (C, I, G,
NX) have been weak or strong? You may want to say that you
will come back to some of them later. (For instance, NX net
exports reappear later in this generic outline.) Fiscal Policy
affects spending directly through G and affects consumption via
taxes.
IV) Financial Markets and the FRB. What has FRB monetary
policy been and what is it expected to be in the near future?
What have some important interest rates been and how are they
expected to change? Have stock prices been rising or falling
recently? Have you read anything about whether changes in the
stock market have affected consumption or investment? Do you
happen to have a strong opinion on what direction stock markets
are headed?
V) Supply Side and International Linkages. Does the economy
appear to be near or away from its potential output? How fast is
potential output growing (due to the growth of productivity as
well as labor and capital)? US exports and imports can be
important influences on the economy. Have they been large

11. recently? Is the US dollar expected to get stronger, weaker, or
stay about the same in the near future?
VI) Conclusion. Which of the aspect of the economy you
discussed above seem to be most important or interesting to you
and why?
VII) References. A good mix of a few government reports,
some economic outlooks from financial institutions, and
newspaper articles you cited in the paper.
VIII) Tables and Figures. The first thing here should be your
forecast table. An old version is posted on D2L. Your forecast
table should have updated forecasts of some important variables
from several sources. At the top of your table should be your
forecast clearly labeled as yours. Your forecast could be an
average of the forecasts you copied from professional sourc es,
or you may have a forecast that is remarkably different than the
consensus.
You should attach at least a few additional graphs or tables.
These should be numbered (Figure One, Figure Two, etc.).
Each figure should be discussed in the paper and should have
had an important influence in shaping your thoughts or the
argument of the paper. Attaching random material will
significantly reduce your grade. Be selective and thoughtful.
6
Module 02 Global Expansion Project
Matthew Marquette
This paper is being submitted on October 14, 2018, for
Professor Matthew Ademola B352/MAN4602-01- Online.

12. Overview of the Company
Mission Solar is the company under focus in this paper.
Mission Solar is planning to open operation in Kenya.
Mission Solar headquartered in San Antonio, Texas, engineer,
design, and assembles all their solar panel.
The company provides world-class performance and guaranteed
long-term reliability.
The product line of the company is suited for utility, residential,
and commercial applications.
Mission Solar is the company under focus in this paper. Mission
Solar is planning to open operation in Kenya. Mission Solar
headquartered in San Antonio, Texas, engineer, design, and
assembles all their solar panels. It makes large-scale solar and
small-scale projects (Mission Solar, n.d). The company provides
world-class performance and guaranteed long-term reliability.
The product line of the company is suited for utility, residential,
and commercial applications. Over time, Mission Solar has
registered significant increased in revenue. These can be
attributed to a high demand for solar products offered by the
Company.
2
A brief description of the product

13. Solar products offered by Mission Solar are of different sizes
and prices.
The products have a 25-year warranty backed by Powerguard's
third party insurance.
Its products are priced depending on the quality and size of the
solar.
The products of the company surpass industry standard
regulations, offering quality performance over a long period.
Solar products offered by Mission Solar are of different sizes
and prices. The products have a 25-year warranty backed by
Powerguard's third party insurance (Mission Solar, n.d). Its
products are priced depending on the quality and size of the
solar. The products of the company surpass industry standard
regulations, offering quality performance over a long period.
The production lines of products are fully automated that
include multiple quality checks. Even though the company has
the aforementioned strengths, lack of sufficient capital to invest
in new markets one of the major limitations faced by the
company.
3
Environmental Analysis of Kenya
Kenya is one of the developing countries in the world.
Kenya has a population of more than 50 million people with a
large majority living in rural areas.
In terms of political factors, the political environment of Kenya
is largely favorable.
The stable political environment makes it favorable to open
operation.

14. Kenya is one of the developing countries in the world. Kenya
has a population of more than 50 million people with a large
majority living in rural areas. In terms of political factors, the
political environment of Kenya is largely favorable. This can be
directly linked to the democratic political system (Market
Research Reports, Inc. 2017). The stable political environment
makes it favorable to open operation. The large population of
people indicates that the market for solar products is lucrative.
In terms of economic factors, Kenya has favorable taxation
policies and inflation is largely attractive.
4
Environmental Analysis of Kenya Cont..”
Kenya has a high domestic demand, geostrategic location, a
strong financial position, and well-educated workforce.
Favorable prices of fuel, low level of competition, and untapped
market are other economic factors of Kenya.
In terms of social factors, Education and health systems of
Kenya is largely favorable.
The literacy level of the country stands at 87.1 percent.
The labor market is highly skilled.
In addition, Kenya has a high domestic demand, geostrategic
location, a strong financial position, and well-educated
workforce. Favorable prices of fuel, low level of competition,
and untapped market are other economic factors of Kenya. The
country is one of the emerging economies in the world. In terms

15. of social factors, Education and health systems of Kenya is
largely favorable (Lucintel, 2013). The literacy level of the
country stands at 87.1 percent. This gives a clear indication that
Mission Solar will not lack human labor to support the
operation of the company. The labor market is highly skilled.
This is due to technical colleges and universities that the
country has heavily invested in.
5
Environmental Analysis of Kenya Cont..”
In terms of technological factors, Kenya is the big user of IT
technology and mobile phone.
Kenya has invested in IT technology and communication
networks.
The presence of technology companies such as Safaricom,
Airtel, and Telkom has made communication more effective in
the country.
With well-development networks systems, it will be easier for
Mission Solar to market its products in the market.
In terms of technological factors, Kenya is the big user of IT
technology and mobile phone. The mobile phones companies are
offering the latest IT products, tablets, and mobile phones in the
market. Kenya has invested in IT technology and
communication networks (Market Research Reports, Inc. 2017).
The presence of technology companies such as Safaricom,
Airtel, and Telkom has made communication more effective in
the country. With well-development networks systems, it will
be easier for Mission Solar to market its products in the market.
Favorable technology industry will largely support the operation
of Mission Solar in Kenya.

16. 6
Environmental Analysis of Kenya Cont..”
In terms of environmental factors, Kenya has favorable
environmental policies and environmental laws.
Environmental policies and environmental laws of Kenya
encourage the use of renewable energy.
Solar products being one of the best renewable sources of
energy is likely to fetch good market.
In terms of legal factors, Kenya has well-established laws and
judicial systems.
In terms of environmental factors, Kenya has favorable
environmental policies and environmental laws. Recently, the
country banned the production of plastic bags and sensitized
citizens to seek renewable energy. Environmental policies and
environmental laws of Kenya encourage the use of renewable
energy (Lucintel, 2013). Since environmental laws and policies
are pro-renewable energy, solar products being one of the best
renewable sources of energy is likely to fetch good market. In
terms of legal factors, Kenya has well-established laws and
judicial systems. The legal position of Kenya is strong as there
is a huge focus on making new regulations and laws.
7
References
Lucintel. (2013). PESTLE Analysis of Kenya. Retrieved from
https://www.lucintel.com/pestle-of-kenya-2013.aspx
Market Research Reports, Inc. (2017). Kenya PESTEL Analysis
Market Research Report. retrieved from

17. https://www.marketresearchreports.com/market-research-
reports-inc/kenya-pestel-analysis-market-research-report
Mission Solar. (n.d). High-Power, American Quality. Retrieved
from http://www.missionsolar.com/