Friday, March 28, 2014

Divorce and the Economy

Divorce and the Economy
By: Leah Thomson

Divorce is no light subject; many families have experienced it and many will continue to. Not only does it have an impact on the families themselves, but it also has an impact on the economy. Many factors of divorce build up over time and hurt the economy in more ways than one. Though it is important to focus on how divorce affects families emotionally, it is important to focus on the affect it has on the economy, as well.
            A little more than twenty years ago, in 1991, it was shown that after a divorce, women became the victims of a decline in income. In a journal issue from, “Financial Impact of Divorce on Children and Their Families” by Jay D. Teachman and Kathleen M. Paasch, a statistic shows that “39% of all divorced women with children and 55% of those with children under six were poor in 1991” (Teachman and Paasch). With decrease in income being a factor of demand, the demand by these families certainly decreased, in turn decreasing demand in the population as a whole. Table 1 below goes on to show that child support makes up 18.5% of the total income of the mother, proving that divorce has a huge impact mostly on the income of the mother.

            The article goes on to state that remarriage or reconciliation helps to heal the economic impact that divorce has. Yet, with remarriage rates decreasing, the period between marriages is much longer, resulting in a longer period of poverty. This poverty causes more demand for a job for the mother. With lower incomes, she can no longer provide normal goods for her children and products automatically become far more elastic to her. Although there is more demand, there is less supply; jobs available to many new entrants into the labor force are often less than full-time employment and/or pay wages below those earned by mothers already in the labor force” (Teachman and Paasch). Since the producers already have workers, they are either less willing to pay money to buy more labor or are only willing to pay the new employees less since they do not need the extra supply. Therefore, divorced mothers continue to live in poverty, thus causing a decrease in economic growth.

            However, more recent trends have shown the divorce rate decreasing. In the article “How Divorce Can Adversely Affect the Economy” by Amanda C. Haury, found  on Investopia, it is found that the divorce rate is 41%, which is lower than it has been in the past and certainly lower than what some people expect it to be. In the graph shown above, it is depicted that the percentage of households in which the mother is the primary provider has increased from below 10% to 40% from 1960 to 2011. Since more families are becoming dual-income, the divorce rate has decreased, allowing for economic growth to happen. “Healthy marriages have been proved to promote economic growth” (Haury), which alternately means that divorce does exactly the opposite. When a married couple turns into a divorced couple, a house and extra resources that were previously shared becomes needed for each person. Although this may increase the demand for the resources needed, the decrease in income and high price of divorce would drive the divorcees into trying to save their money.
            Divorce has a large impact on the economy, and although sometimes it is inevitable, there are ways that people are beginning to prevent it. Getting married at an older age and ensuring financial stability before marriage are solid ways in which couples are attempting to guarantee that they will not get divorced. If the divorce rate continues to decline and families become more dual-income based, the economy will prosper and hopefully steer away from being impacted by divorce.

Works Cited

Haury, Amanda. "How Divorce Can Adversely Affect The Economy." Investopedia. N.p., 7 Nov. 2012. Web. 14 Mar. 2014. <>.

Teachman, Jay, and Kathleen Paasch. "The Future of Children, Princeton - Brookings: Providing research and analysis to promote effective policies and programs for children.."  - The Future of Children -. N.p., n.d. Web. 14 Mar. 2014. <§ionid=2802>.

Okay, what just happened? The story of Motorola, Google and Lenovo.

Okay, what just happened? The story of Motorola, Google and Lenovo.
By Bijoy Babu
A couple of years ago, 3 to be precise, I was sitting at home and reading the news like I normally do. To be honest, I love reading the news, especially technology news. Reading about what giant tech companies like Google, Samsung, Intel, Microsoft and Nvidia fascinate me. So when I come across an article entitled: “Google to buy Motorola Mobility for $12.5 billion.” I go crazy. It would become Google’s largest acquisition to date. I have been waiting a long time for someone to come in and save the dying Motorola company. Even though Motorola had invented the first cellphone about 30 years ago and has seen increases in revenue and profits, in the last few years it has been spilling cash left and right.

The above image shows movement of stock prices since Motorola split into it’s two divisions in February of 2011. You can see that Motorola Mobility has been steadily decreasing since then. In August of 2011 is when Google announced it had purchased Motorola Mobility.

According to CNN Money, Google’s acquisition of Motorola in August of 2011 had many people worried that even though Motorola is getting financial support from Google to become once again a competitive player in the smartphone industry, “Analysts expressed concern that buying Motorola Mobility will anger Google's other handset manufacturing partners.” These manufacturers include Samsung, HTC and LG Electronics, some of Google’s biggest clients in their Android software division. Seeing that Motorola had become a Google company, other manufacturers get suspicious of money being transferred back and forth between these two companies. If this was not enough bad news, on August 15th, 2011, the day Google finalized the purchase, Motorola Mobility shares went up by 78%. Although it was seen as a short term success, Motorola and Google will soon realize that the success will soon fade away.

After about a year of mediocre earnings and five straight quarter losses, Motorola had finally made the announcement people all over the world were waiting for. The first Motorola smartphone since the Google acquisition. On August 23rd, 2013, Motorola unveiled the Moto X. A completely new android smartphone line that was designed and manufactured by Motorola which was built in the United States. The phone had received numerous awards for its unique features such as Motorola’s Active Notifications, contextual voice recognition systems, user friendly experience and a behemoth of customization options through its Moto Maker website. With all of these features driving the Moto X to be one of the best smartphones of 2013, Motorola had also announced disappointing results a couple of months after launch. Many analysts criticized Motorola for not expanding sales outside of the U.S and for the somewhat expensive price tag. Even though the smartphone was built in the U.S, it is a very expensive process that coupled with last year’s internal hardware make many people ignore the phone for some other phone with the latest hardware.

The Moto X pictured above in a variety of custom colors. Even though the phone was praised for its simple user interface and unique features, it failed to meet the demand and sales of Motorola’s competition including Samsung and Apple.

After all of the hard work and frustrating losses that Motorola and Google had endured, it was time for a shift in business strategies. At the time, I did not realize that Motorola was doing so poorly. The Moto X was without a doubt the next phone I was going to buy. (If I can ever get rid of my current one) It was starting to become a popular choice for people who wanted a unique experience like none other. The fact that people knew what the Moto X was was a clear sign that sales were going up. This is partly due to Motorola cutting $100 off the full retail price, adding more customization options and spreading sales across the world. As more and more people became familiar with Motorola’s strategy to give you a phone that you will enjoy and find helpful without the gimmicks is a true achievement. Too bad this story lasted for about 2 months.

On January 29th, 2014, CEO of Google Larry Page had announced that Google had made a deal to sell Motorola Mobility to Lenovo for 3 billion dollars. Now this came as a surprise that I did not expect, nor did I really want it to happen. Lenovo at this time is still the number one PC manufacturer in the world and the fastest growing, but its smartphone division is lacking in growth. People had started expressing their concerns all over the internet on why Lenovo could kill the once household name of Motorola Mobility and their great line of products. So did Google sell Motorola because other manufacturers were getting skeptical of the acquisition, or was it because Google wanted to get rid of Motorola as fast as they could because of the disappointing sales. The answer is actually none of these reasons. The main reason why Google sold Motorola to Lenovo is to not only help Lenovo grow their smartphone business, but to keep the 17,000 patents that were once owned by Motorola. According to The Economic Times of India: “While Google's business depends on phones getting into the hands of more people around the world, it benefits from selling the ads on those phones, not the phones themselves. Selling Motorola is an acknowledgment that Google is better off focusing on its core competencies - making software and selling ads - particularly as the profit margins for phones are shrinking overall.”
The above picture breaks down the key areas in which Google had benefited from the Lenovo purchase of Motorola.

So, the deal ultimately was a jackpot for Google. Not only did Google keep the 17,000 Motorola patents, but it is helping out a wider market of smartphones since Lenovo has a large presence in the Asian and European Markets. By holding on to a brand name like Motorola, Lenovo can expand its smartphone business and hopefully in the future grow sales that will match that of competitors like Samsung and Apple. Motorola may have been tossed around here and there, but they are truly the star of the show. Hopefully, only time will tell if Lenovo and Motorola together can give us products that we will cherish for many years. Hopefully the marginal benefit will exceed the marginal cost.


Goldman, David. Google to buy Motorola for $12.5 billion. 18 August 2011. 25 March 2014 <>.

Sikka, Puneet. Must know: Why did Google sell its Motorola business to Lenovo? 11 March 2014. 25 March 2014 <>.

Miller, Claire Cain. Google sells Motorola to Lenovo for $2.9 bn, after paying $12.5 bn to buy it. 30 January 2014. 25 March 2014 <>.

Thursday, March 27, 2014

Costs of Unemployment

Costs of Unemployment
By Michael Mizia

Unemployment can cause many people to lose hope that they wont be able to afford anything anymore. But the one thing people do not know is that even being unemployed can cost a nations government hundreds of thousands of dollars in helping unemployed citizens. According to, those who are unemployed find it more difficult to get work in the future(known as the hysteresis effect). Citizens who become disinterested in wanting to find work again will cause the government multiple problems as well as themselves. When people get fired or laid off from their jobs, they will most likely become depressed and won’t want to do anything for the first few days of being unemployed. This can cause stress as well as health problems to the individuals. Not only people, but a nation itself can suffer from suffering from unemployment. Having people who are out of work means that a nation’s economy is suffering from a lower GDP than they would if they had no unemployment. A lower GDP for a nation means the economy will be below full capacity this is inefficient and will lead to lower output and incomes.


The government struggles to support so many unemployed americans. According to, unemployed Americans have cost the Government over half a trillion dollars in unemployment benefits within the last five years. Americans who continue to stay unemployed are just causing the government more trouble by driving them further into debt while trying to help the people who need money. Referring back to, a study was conducted where the many unemployment programs were extended to see just how much money was going to be spent and upon doing so they found out that by hypothetically increasing how long these programs last the nations GDP would rise by 0.2% and 300,000 jobs would be addedobama misery.jpg

According to a website titled, Since its inception in 2008, extended unemployment insurance (UI) benefits have provided critical support to millions of workers and their families. Allowing the unemployment insurance to run out would damage the economy even more than it already is. Failure to extend the unemployment insurance would cost an estimated 240,000 jobs in 2014. Lifting people out of poverty comes with a cost, although the government is saving people from starving and losing everything, they still suffer because they are taking money out that they won’t be able to repay to make sure people are able to continue their lives on a day to day basis without having to worry about money.

In the end, although unemployment can happen to anyone at any time don’t let it frighten you, having jobs open up allow an economy to prosper because there are always people looking for work.


Summer Fest
By Julia Lutz

Every year people look forward to summer, whether it’s being able to walk outside without a jacket or being able to go the beach.  Lucky for Wisconsin we have something even better; Summer Fest. Summer Fest in an annual summer music festival that is held right on the shores of Lake Michigan in Milwaukee. Head liners such as Lady Gaga, Bruno Marz, and Dave Mathews Band are playing there this summer. Music isn’t the only thing Summer Fest is good for though.
            Summer Fest has been bringing in about $181.3 Million annually. That includes foods, tickets, bus rides down, ect. Summer Fest continually growing and fast; last summer it made over 187 million, an increase of about 6 million dollars.
Having “The Largest Music Festival in the world” in our own back yard, (taking up over 78acres), we attract a lot of tourist which gives Milwaukee a chance to self promote the city. The city draws over 850,000 people each year, making the economy circuit flow fast in that two week span.
Not everyone agrees with the high spirits of Summer Fest though. Writer Bruce Murphy writes in his article “The Arrogance of Summer Fest” that “Summer Fest executive director Don Smiley has ballooned from $280,000 in 2005 to $772, 575 in 2011. That is completely out of line with salaries paid in the past to Summer Fest directors.”
Later in the article he argues saying that Smiley gets over paid. That though this is a private business would sponsors and donators still contribute if they knew the amount that he still makes.
I say the answer is yes. The demand for Summer Fest is so high, if the sponsors backed out they would lose too much business. Summer Fest is one of those places where the small business can self promote themselves. The food stands and shopping venues get a chance to get their name out there and have people fall in love with their products.
Summer Fest also brings so many people in each year that their ticket prices are very elastic. Raising the entry fee from one dollar to 18 won’t stop people from going for good food, and better music experience.
Same goes for the food and drinks, the overpriced food won’t stop people from buying it, the quality food and it being the middle of summer, people are going to need to buy the overpriced drinks and food and not think twice about it.
For Summer Fest 2014 it is expected that they raise the beer price by fifty cents. Even with the slight increase in prices they are still expected to make over four million dollars even after expenses this coming summer. With Summer Fest growing and a steady fast pace rate, the board has also approved projects improving the grounds and especially the Amphitheater. With all of the steady income Summer Fest brings in, they worry of losing money with repairs isn’t even in the air.
 Overall Summer Fest is a huge economical reliance for the city of Milwaukee. It brings tourism, creates job, and a place to enjoy the lake front. Summer Fest increase in income each year allows it to grow and become better than the next which makes it that much more enjoyable every year.

Works cited


Instagram May Begin Making Profit

Instagram May Begin Making Profit
Leah Vetro

With picture-sharing app Instagram gaining more users every day, the creators of the popular nonprofit app are beginning to think of ways to make money off of it. Instagram was created by Kevin Systrom in 2010, and was bought by Facebook in 2012. Since Facebook bought the app, Instagram gained 128 million users by September of 2013 and is now valued at $1 billion. How is it that the app is worth so much, yet hasn’t made any profit?

The spike in popularity shown in the graph above gives creators hope that they can begin to make marginal profit off of their successful app. Instagram is valued so highly because Facebook initially offered $1 billion to buy the app, but they have yet to make profit off of it. Consumers willingly download the app because, for one, it is free, and secondly they have the positive externality of enjoying what Instagram claims to do, “to capture and share the world's moments.” While Instagram users continue to benefit from the app, those who produced it bear the negative externality of making no revenue.

What is stopping Instagram from making millions of dollars? It’d be easy enough to make the app cost a buck to install, however; this cost could cost them their popularity and drive away their targeted market of teenagers. The purpose of making the free app also free of ads for the first few years is to increase the popularity and number of users. Just like how free samples are handed out to draw people in, the intent of the free app is to attract people to the product and get them hooked. The danger in adding a cost to the product is that although Instagram would make profitable gain, the negative externality of the added cost for users could cause them to turn to free substitutes.

Big changes are in the future for Instagram. Do not worry—there are no plans to actually add a cost to download the app, however; director of business and operations Emily White faces the challenge of “how to integrate marketing without jeopardizing Instagram's cool factor.” She fears that advertisements will clutter the environment. When Instagram tried to change the terms of service, the unclear information about advertisers having access to the photos angered costumers and caused the daily number of users to drop by 4 million. Despite the consumers’ backlash, White does believe ads will be a part of Instagram in the near future as long as it is done right. Instagram could also make a profit from charging low subscription fees. They would see plenty of revenue, and customers who are hooked would most likely be willing to pay the extra buck to keep the app.

No matter what the approach, creators of the app have plenty of options to begin to make profit. What is left to decide is how they will find a way to ensure the marginal costs do not outweigh the marginal benefits. If the cost of customer satisfaction is of less importance than the expected millions of dollars in revenue, it is up for the creators to decide—will it be worth the risk?

Works Cited
"How Instagram Can Make Money — Without Alienating Users." Knowledge@Wharton. Wharton School of the University of Pennsylvania, 2 Jan. 2013. Web. 23 Mar. 2014. <>.
Luckerson, Victor. "These 8 Internet Companies Are Worth Over 1 Billion But They Havent Made a Dime." Time. Time Inc., 29 Oct. 2013. Web. 23 Mar. 2014. <>.
Rusli, Evelyn M.. "Instagram Pictures Itself Making Money." The Wall Street Journal. Dow Jones & Company, 8 Sept. 2013. Web. 23 Mar. 2014. <>.
Spencer, Graham. "A Look Back At Instagram’s Growth As It Hits 100 Million Monthly Active Users." MacStories. N.p., 26 Feb. 2013. Web. 23 Mar. 2014. <>.

Drug Testing for Welfare

Drug Testing For Welfare
Joe Henderson

Last year, Utah Legislation passed a law that would require all welfare applicants to get screened for drugs. “The whole purpose is to get people back to work.” Said Rep. Brad Wilson. There are multiple steps to this process. First, there is a written questionnaire that tests for a high probability of drug use. The suspicious people are then drug tested. According to, The state spent nearly $6,000 on written tests for 4,730 applicants, 466 of which had to take a drug test, which cost more than $25,000.” If you test positive, you are required to complete a substance abuse treatment program. In the end, the entire program saved the state nearly $350,000. Not only because they caught 12 people, but 250 didn’t even give an effort to apply for government assistance because they knew they would test positive for illegal substances. This whole program gives initiative to the people living off the government to go find a job. In the end, the states of Utah spent $30,000 to put the program into effect and saved $350,000 out of it. That’s $320,000 back into the taxpayers’ wallets in the first year that would have gone to people that abuse illegal substances. There has been some controversy over the whole drug testing dilemma, but bills like the one in Utah have passed in 9 states. With over 100 million families receiving some sort of government assistance, it is only right to make sure we are giving the money to people who really need it.

 In Florida, there was a large controversy over if it was really saving the taxpayers money. They spent $45,000 on the program and only caught 2% of the recipients. The other 98% passed and it ultimately cost the taxpayers to pay a little more. States like Minnesota want to make the drug testing random. If this were to be in effect, the state could set a budget on how much to spend on the drug tests and how many people to test. For most jobs, you have to pass a drug test so it’s only fair for the welfare recipients to get tested also.
Works Cited

"CLiNiCAL CYNiC." 100 million Americans on welfare....Web. 4 Mar. 2014. <>.
"Minnesota Officials Complain That Drug Testing Welfare Recipients Is A Waste Of Time And Money." ThinkProgress RSS. Web. 2 Mar. 2014. <>.
"Utah Spent More Than $30,000 To Catch 12 Drug Users On Welfare." ThinkProgress RSS. Web. 3 Mar. 2014. <>.
"Utah's welfare drug testing saved more than $350,000 in first year, officials say." Web. 2 Mar. 2014. <>.

"Why drug testing of welfare recipients is a bad idea | Station.6.Underground." Why drug testing of welfare recipients is a bad idea | Station.6.Underground. Web. 4 Mar. 2014. <>.

Thursday, March 20, 2014

Is The Cost Of College Worth It?

Taylor Johnson
Mrs. Straub
17 March 2014

Is The Cost Of College Worth It?

With spring break quickly approaching, high school seniors are beginning to prepare for an even bigger celebration – graduation.  As their days in high school come to a close, the question they have all been asked since the first day of kindergarten suddenly doesn’t seem too farfetched: what do they want to be when they grow up? For some, college decisions have already been made, housing contracts signed, and roommates found. For others, military recruiters have been contacted and boot camp is only a few months away. But for the rest, it’s time to make a decision.

High schools around the country have had a continuous push for higher education and stimulating educational experiences after graduation. But with the continually increasing cost of college tuition, many students are forced to choose between a college education and a secure bank account. Students need money for college, college to get a steady job, and a job to make money. Who decided upon this system? When forced to choose between their own education and their current financial status, students must weigh the opportunity cost of selecting a university vs. finding and maintaining a full time job.

According to the New York Times, “college tuition continues to outpace median family income and the cost of medical care, food and housing.” Although a college education opens up countless doors for opportunity after graduation, including an average of 80% more income than students only receiving a high school diploma, a family should not be paying more than their annual salaries to send their child to school.

It is no question that college is becoming more and more expensive each year, but rather what it is that is causing this steep incline. As students are beginning to discover the benefits of a college education, the demand continues to increase. There are only so many classrooms, dorms, and professors at a university however; and as the number of students continues to increase, supply and access to these necessities decreases. In order to accommodate the growing number of students, universities need to expand. Building new education and housing buildings is not a cheap affair and needs to be funded for somehow, so another few hundred dollars can be tacked onto tuition to cover it. As college becomes more competitive and the number of available spots decreases, students suddenly are willing to pay more for their education and when the students are willing to pay more, why would the university want to lower tuition and accept less?

Prior to committing to a university, prospective students must first weigh the marginal costs and marginal benefits of a college education. The marginal benefits largely being a more expansive educational experience, greater knowledge, and a larger salary, which of course sound great in theory but with an average marginal cost of nearly $10,000 per year at public universities nationwide, students must determine if the eventual benefits outweigh the current costs.

It is no easy task to make decisions for our future, but when forced to choose between financial securities now or a greater salary later, the decision becomes even more complex. In order to fully be sure you are making the right decision when it comes to higher education, make it an informed one by comparing and contrasting the possible benefits of a college education vs. working a full time job after graduation.

For Additional Information:

Works Cited:

"Cost Of College." College Data. N.p., n.d. Web. 17 Mar. 2014. <>.

"How to Get College Tuition Under Control." The Wall Street Journal. Dow Jones & Company, n.d. Web. 17 Mar. 2014. <

"Soaring College Tuitions." The New York Times. N.p., n.d. Web. 17 Mar. 2014. <
By Danielle Jasinski

It’s seems that everyone theses day are on Facebook.; there are over 1.11 billion Facebook users in this world, and to this day it’s still growing. This social media sites is one of the greatest to be invented; you can not only look through other people’s pictures but you are also allowed to communicate with them too. It’s a fast and easy way to catch up with loved ones and friends. Since 2012 there has been a 22% increase of people getting connected with Facebook and not only that but 75% of Facebook users are outside of the United States. Not many people understand the true impact Facebook has made on our economy today, it’s not only a fun site to use but it has also helped out many people get jobs also. With Facebook growing more and more each year job opportunities have opened up in this market. Jessica Miller – Merrell on Huff Post says, “this is a solid strategy for Facebook as there are a number of technology companies and job boards who are 'all in' having established platforms, services, and apps for job seekers, recruiting, and hiring contained within Facebook.” With unemployment rate beginning to rise, Facebook is going to have a huge impact when it comes to giving people jobs. This is the world’s largest social media site and everyone wants in on it.

This chart above shows how greatly Facebook has risen over  the past couple years, and it seems as if it will only keep going up. If Facebook keeps up the popularity that it has right now, unemployment rate could slowly start to decrease. Right now Facebook only has 4,619 but if this social media sensation plays it’s card rights, this business will begin to start growing larger than it already is. 

Even though they’re many other social media sites out there, nothing can quite possibly compare to Facebook and all the progress they have made over the years. The numbers show it and in the chart above you can see that all the other websites don’t even come close to the numbers Facebook have. Although others have begun to try out new sites, everyone eventually ends up on Facebook to find out the latest gossip or post that have been put on there. It’s as if this social media has become an addiction to the world because everyone wants to know what’s going on in others lives at all times.

As said before 75% of Facebook users aren’t in the US so Facebook hasn’t only made a huge impact on the job market in the United States but it also has for other countries too. A country that it has greatly impacted would be Europe. Facebook adds an estimate of a 15.3 billion dollar value to the European economy and also has given over 232,000 thousand jobs across Europe. Not only has it given out so many jobs but it also supports around 29,000 jobs too. Facebook COO Sheryl Sandberg said in a statement, "Today's report shows that Facebook is about a lot more than sharing pictures or keeping up with friends; increasingly social media means growth and jobs, as the Deloitte study highlights, social media is proving particularly valuable for small and medium sized businesses, which form the backbone of the European economy. The impact of social media is a bright spot in challenging times, but growth won't happen on its own. We need to make sure that we invest in the right education, training, technology and networks so that social media can continue to drive innovation and economic growth." Sheryl Sandberg states this perfectly, this shouldn’t just deal with Europe but all the other countries involved with Facebook too. Facebook is making a huge impact in a positive way for our economy, it’s just whether we capitalize on the opportunities we are given.

Work Cited
Miller-Merrell, Jessica. "Facebook Jobs Will Positively Impact the U.S. Economy and Job Marketplace." The Huffington Post., 18 July 2012. Web. 17 Mar. 2014.

"Facebook created 232,000 European jobs in 2011 (study)." ZDNet. N.p., n.d. Web. 17 Mar. 2014.

"Facebook Statistics." Statistic Brain RSS. N.p., n.d. Web. 15 Mar. 2014.

"From Teenage Prodigy to Billionaire Philanthropist: How Mark Zuckerberg Grew up with Facebook." International Business Times RSS. N.p., n.d. Web. 17 Mar. 2014.

"10 Useful Social Networking Usage Statistics and Insights for 2014 | Our Social Times - Social Media Agency, Social Media Training." Our Social Times Social Media Agency Social Media Training. N.p., n.d. Web. 16 Mar. 2014.

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