Do movie theaters help the economy?

Danielle Sallman

Econ

Mr. Reuter

April 6th, 2016

Do movie theaters help the economy?

The amount of money people spend on movie ticket yearly is rising in numbers as better movies start to come out. Most people go to movies with their friends at least twice a month which initially results in quite a bit of money getting spent at the movie theatre. With this money being spent there is a demand for more movies. According to The Numbers web page it said that the top movie in 2015 is Star Wars with over 2 trillion dollars in sales in the worldwide box office. The amount of tickets sold for a general movie is alway rather high because everyone wants to see the new popular movie that everyone is talking about. But what amount of the money actually goes back to the theatre? According to themovieblog web page, it says that the theatre only get about 25% of the money of profits because the rest goes back to the companies who make the movies. How does this affect the economy? Well the amount of money that goes back to the movie production companies goes back to producing more money to make newer movies that you will eventually go to see. It’s a circle of money spending in reality.

When the recession hit, people had other things on their mind than spending ten dollars to see a movie and then buying 20 dollars worth of snacks or more depending on if it was just you or if you were with a family member. Movie theater trips can be expensive and not everyone can go every single week but during the recession the amount of people who would go to movies at least once a week was deflating quickly.

Not many people would guess this but in 2010 the number of people who go to see movies dropped by 1 million, which would definitely affect the profits earned. But in 2016 with numbers steadily rising it is safe to assume that movie theaters are helping our economy.

Work Cited

Acuna, Kirsten. "Movie Ticket Sales Are Down 100 Million From A Decade Ago [Chart]." Business Insider. Business Insider, Inc, 04 Sept. 2012. Web. 06 Apr. 2016.

CNN. Cable News Network, n.d. Web. 06 Apr. 2016.

"Economics Of The Movie Theater ? Where The Money Goes And Why It Costs Us So Much." The Movie Blog. N.p., n.d. Web. 06 Apr. 2016.

"Movie Box Office Records." The Numbers. N.p., n.d. Web. 06 Apr. 2016.

Susman, Gary. "Movies And The Economy: Courting Adults In A Time Of Declining Film Attendance." The Huffington Post. TheHuffingtonPost.com, n.d. Web. 06 Apr. 2016.

Terrorists Break Down the Economy

Rodney Brandenburg III

Mr. Reuter - B2

Econ

23 March 2016

Terrorists Break Down the Economy

As we all have seen in our lifetimes, there are groups of horrible people who try to destroy countries with violence at a completely new level. Here in the United States we have only directly felt the wave of one major event: The 9/11 attack on the World Trade Center. The immediate effect was the wave of fear sweeping over the nation and the economy was thrown down the drain. Demand had decreased severely for the airline industry, and New York was thrown into a state of chaos for a few days. The entire goal of the attack was to cripple our economy, and it nearly succeeded. We were forced to close the stock market for four trading days, which are essentially the same as business days (Monday thru Friday), in order to collect ourselves and ‘control’ the situation. Once the stock market opened up on September 17th, the DOW dropped 7.13% which remains the largest one day drop ever.

Overall, the 9/11 attack worsened the already painful 2001 recession that had started earlier that year. The attack caused the economy to contract 1.1%, which added to the debt and extended the recession. The long term effects don’t come directly from the attacks, but from the response from President Bush. The War on Terror added over $1.8 trillion dollars to the total debt of the country, which would eventually lead to the 2011 debt crisis. The debt crisis was caused by the ‘tea party republicans’ refusing to raise the Debt Ceiling, this was to attempt to prevent the national debt from rising any higher. However, in 2013, the government was forced to shut down for 16 days, due to the same reason. Even today, the 9/11 attacks are affecting the economy which shows that the terrorist group's plans had succeeded.

Attacks in France

After the major terrorist group, Al Qaeda, was destroyed we thought we had nearly won the War on Terror. We were right for a few years however, in November of 2015 a new threat emerged when bombs were detonated in Paris, France. These bombings occurred in an extremely public area and were completely uncalled for. Following the attack, reports say that the damage caused will cost upwards of €2 billion, which may only be a 0.1% decrease in the GDP of €2 trillion but for a country that hasn’t been able to have much economic growth, this decrease could be detrimental. The major source of harm to the economy may not be the attack itself, but the effects on tourism and retail trade.

The public attack would definitely cause people to rethink their trip out to France, but it would also deter the people who are already there causing them to shorten their trip and not buy the things they might have before. The decrease in tourism would effectively decrease the demand for things like ‘I Heart Paris’ shirts and all of the other kinds of souvenirs. The leads to a surplus of these items which would definitely hurt the economy, especially since France is a popular place for people to visit. In addition to the actual goods that are sold, the country will also miss out on much of its hotel and airline income since less people are going to visit. In the end, France will be able to recover from such an attack, but not before losing much of its revenue from the popular tourist locations and goods.

Attack in Belgium

Much like the events that occurred in Paris, the bombings in Belgium will definitely harm the tourism. However, Belgium is known for it’s huge spike in tourism during the Easter season. Many people chose to visit the many churches and places of worship in Belgium and with this attack people will be less likely to go. Much of Belgium's popular items like it’s chocolate will now be in a Surplus since they would produce more due to the large amount of people coming in. Since the attacks in Belgium are so recent there isn’t much to say about the long term effects, but it would most likely appear similar to the long term effects of Paris, since they both rely heavily on their tourism industry to add to their economy. Many people go straight to the physical damage caused by the terrorist attacks in countries, but the buildings, streets, and metros can be repaired. The lives are forever lost and the country remains forever changed. The economy is another thing that can be heavily altered by these events, which could lead to even an even more difficult time for the families that lost mothers, fathers, brothers, and sisters. Overall, Terrorism affects the entire country, people, governments, and the economies as well, and in the end, some of these things will never be able to return to ‘normal’.  

Amazon's Increasing Effect on the US Economy

Danae Krieger

Mr. Reuter

Economics

5 April 2016

Amazon’s Increasing Effect on the US Economy

Americans have been accustomed to shopping at the same stores, such as Walmart, J.C. Penney, Sears and Target, for their entire lives. At first they had to physically go to the store to get what they needed. Then, eventually came the luxury of making purchases from the comfort of their own homes. Despite this normality of buying the same products from the same place, Americans became eager to try a new service--Amazon--that is strictly online. It did not take long for Amazon to grow in popularity, especially since they developed the Amazon Prime membership option, which both they and the consumer benefit from. However, Amazon’s success has begun to make a negative impact on its competitors and, ultimately, America’s economy.

With an increasing demand for making purchases on Amazon, many companies are being forced to close some of their stores. Walmart, in particular, is closing 269 stores: 154 in the United States, including 4 in the Milwaukee area, and 115 overseas. This has the potential to result in the loss of up to 16,000 jobs, with 10,000 of those being in the United States. This large amount has the potential to hurt the American economy: 10,000 people being put out of their jobs means an increased unemployment rate, lower income for consumers (and therefore producers as well since the consumers can’t spend as much), resulting in the occurrence of the income effect. And this is considering Walmart’s numbers alone.

Other stores, including Macy’s, Sears, and J.C. Penney are following Walmart’s lead. Though they are not closing as many stores, they all are facing economic problems. Macy’s will close 40 locations, Sears 50 and J.C. Penney 39. These are only four of the stores on the long list of companies that have plans to close some of their doors throughout the world by the end of 2016.

In 2013 Amazon was the largest online retailer in the United States. Also, they were responsible for almost 25% of the retail sales growth in 2015. Now, the once prosperous companies that had little fear of competition are slowly getting put out of business. It seems as if Amazon is creating a monopoly, even though it will never successfully happen since monopolies are prohibited in the United States. As the illustration below depicts, Amazon was even successful in beating Apple in 2013, and by a whopping $49.6 billion.

Amazon is gaining power, and doing so quickly. It is almost scary to imagine what these numbers will look like after at the end of the year when many of their competitors have down-sized and as the number of online shoppers is expected to continue increasing (see below). It is probable that Amazon, and any comparable services that may be developed in the future, will become the preferred method of making purchases.

In an attempt to revive themselves, Walmart has plans to “invest further in online operations and pour money into improving customers' experience” which may drag down their earnings for the fiscal year as much as 12% (Associated Press). This may provide some relief to America’s economy as they and other stores battle against the overwhelming power of Amazon.

Works Cited

Tabuchi, Hiroko. "Walmart to Close 269 Stores as Retailers Struggle." The New York Times. The New York Times, 15 Jan. 2016. Web. 04 Apr. 2016.

"Wal-Mart to Close 269 Stores, including 4 in Milwaukee Area." N.p., n.d. Web. 04 Apr. 2016.

Amusement Parks

Andrew Mielke

Mr. Reuter

Economics

April 3, 2016

Amusement Parks

As a child everyone dreamed of going to Disney World, and if you were lucky that dream came true and you were able to experience the magic that Walt Disney had imagined. However, as children we never thought of the economic benefits that Disney World and other amusement parks and attraction across the world bring. The IAAPA (International Association of Amusement Parks and Attractions) did a study to specifically describe the benefits that come with amusement parks and attraction big and small.

The IAAPA researched 400 amusement parks and attractions in the United States  in 2011 there were 375 million guest annually through all of the amusement parks and attractions in the nation. The IAAPA then estimated that those 400 places produced an economic impact of $219 billion in 2011, of that $219 billion, theme parks, amusement parks and water parks then directly generated $55 billion in 2011. These numbers stem from the ticket prices, memorabilia and the many food chains that reside in amusement parks and attractions. The amount of money and that can be produced by simple attractions and amusement parks is very interesting considering that 90% of all the amusement parks operate year round. Also you would have to consider the fact that billions of dollars is also put into the upkeep and improvements that are needed to keep the parks functional.

Not only do the amusement parks and attractions produce a large amount of income, but they also are able to create millions of jobs. The amusement park industry is a leader in the creation of non-exportable jobs in the U.S.. The industry directly creates 1.3 million jobs and indirectly creates 1 million job, such as steel manufacturing, creating a total of 2.3 million jobs alone in the U.S.. Even more interesting is that of 204 people surveyed, 28% of those people said that they would want to work at an amusement park.

Another fact to ponder is that that many of the guest that go to these amusement parks go often, at almost a yearly rate.In a similar surveyed conducted like the one above 204 people were surveyed and 25% of the people said they have been to an amusement park in the last 12 months and 43% of people said they were planning on visiting an amusement park in the next 12 months, such a constant and reliable infrastructure of the amusement park industry. Many of these people that come as guest are families with children of 2-18 years of age.

The amusement park industry is one of the best and biggest in the world, not only do they have millions of people visit each year but they produce an extreme amount of money for such an enjoyable and ageless experience for all ages. Also, the amount of jobs that the industry produces is just another bright star that the industry is able to bring to the economy. As the U.S. population increases the more and more popular and successful the amusement park industry is able to become.

Works Cited

"Amusement Parks and Attractions Industry Statistics." IAAPA. International Association of Amusement Parks and Attractions, 2012. Web. 3 Apr. 2016.

How the Zika Virus is Affecting Spring Break Plans

Taylor Vander Wyst

Mrs. Straub

AP Economics - Insight

21 March 2016

How the Zika Virus is Affecting Spring Break Plans

People are anxiously waiting for spring break and packing their bags for a much needed vacation--however, they may want to consider unpacking their bags if they are traveling to a tropical location. Over the past couple months, the zika virus has been emerging in Mexico, Brazil, and the Caribbean. The Aedes mosquito species carries the zika virus which can cause harm to women and their babies (About). While growing in a mother who is infected with the zika virus, the baby can develop microcephaly which is a condition where the head is significantly smaller than the rest of their body. This can lead to many other birth defects as well (About).  Because of this risk, it has become difficult for people to decide whether or not to go on vacation because the trade offs are so extreme.

The zika virus is transmitted when someone gets bitten by the Aedes mosquito species. According to the Centers for Disease Control and Prevention, symptoms can include fever, rash, and joint pain. Since these symptoms are so minor, many people may not even know they contracted the virus--which is why it is so dangerous for women who plan to get pregnant. If someone takes the risk and travels to a country with the zika virus, some preventative measures to take are to wear long sleeve shirts and use bug repellant often. Hotel owners and managers have also been taking precautions by spraying more often to ensure that guests are safe (Mindock). Here is a map showing the countries that have been affected with the zika virus. The purple areas are where the virus has spread. Based on its proximity to the United States, it may not be long before the zika virus invades our borders.

Spring breakers are strongly advised to take precautions from the Center for Disease Control to determine if the risk is too great to travel. But canceling the vacation can be very costly since some resorts and airlines don’t offer refunds. Fortunately, airlines such as United Airlines, American Airlines, and JetBlue are offering refunds for women with doctors excuses (Vora). However, the other family members without a doctor’s excuse still have to pay. Jack Ezon, the president of the New York travel company Ovation Vacations, says that he “has had more than 50 cancellations for trips to the Caribbean and Mexico,” (Vora). If the zika virus continues to worsen, these numbers could increase. Since there are less vacationers willing to travel, the spending multiplier will decrease, thus resulting in less money circulating throughout these countries. Less people staying at resorts and hotels may also result in workers being laid off, leaving them frictionally unemployed. Then those unemployed laborers off will be in a job search. In St. Martin, 85% of the workers are employed by tourism directly or indirectly. They depend on tourists to make a living (Mindock). For poorer islands that make up the Caribbean, cash flow is essential to their GDP. In fact, tourism in Barbados makes up 36% of their GDP (Mandock). If more and more people avoid vacation destinations in the Caribbean, their GDP would significantly decrease which would negatively affect their economy.

Unless we can stop this problem and find a cure for the zika virus, increasing numbers of tourists might cancel their spring break trips for fear of the negative health effects for mothers and babies. For those who do not cancel their trips, extreme precautions must be taken to ensure that their spring break trips are safe.

Works Cited

“About Zika Virus Disease.” Centers for Disease Control and Prevention. Centers for Disease Control and Prevention, 22 Feb. 2016. Web. 20 Mar. 2016.

Mindock, Clark. “Will the Zika Virus Hurt Tourism in the Caribbean?” International Business Times. Ibt Media Inc., 27 Jan. 2016. Web. 20 Mar. 2016.

Vora, Shivani. “How the Zika Virus is Affecting Travel.” The New York Times. The New York Times, 28 Jan. 2016. Web. 20 Mar. 2016.

Economic Impacts Of March Madness

Zachary Corso

Mrs.Straub

AP Economics

Tuesday March 22nd

Economic Impacts Of March Madness

Its that time of year where everyone's turned their attention to the courts. Everyone fills out a bracket and hold tight that there final pick makes it all the way to the championship. Yea that right it's March Madness one of the best times of the year. For friends to fight over whose bracket is better.  According to Wallet Hub the chances of getting a perfect bracket is 1 in 9.2 quintillion yea that's right and that you have a better chance of winning back to back mega million lottery tickets than by filling out a perfect bracket.Yet the odds are unlike no other it still a massive economic booster for many of the hosting cities. And one of the best times to clench all of your attention towards the big screen and to see the underdog take home the win. Later on you will be able to grasp the economic impacts March Madness has, such as the profits TV gains, host cities, and overall productivity. All of these factors are major positive and negative impacts towards the economy.

First let's take a look at the real impact March Madness has on the economy. As there is an increase in demand for basketball fans to tune into watching March Madness. According to NCAA it is estimated that March Madness Live had reached all times records such as 80.7 million videos streamers. With the increase in demand that leaves March Madness live with “...17% over last year”(NCAA). Which as showed a rightward shift in the demand curve because of the increase of viewers.

Now one might wonder what this increase of demand for March Madness posses such as the profits gained from TV, as well as restaurants, and host cities. It was estimated that the “average 30 second ad sold for $1.5 million”(Ogus). Which will bring in a total revenue of $1.1 billion. Yet the price is high for companies they have to look at the opportunity cost in which tv companies need to take a look at each side by taking a look at the benefits in which option is better. They have to take a look and see if the higher price is really worth it. By taking a look at the increase in viewers for such a popular event as well as the return rate. And that the host city of the final 4 games which is Houston this year gains $300 million dollars. Witch is is not counting in all of the other restaurants all over the world that supply that kind of atmosphere that everyone loves.

But while taking a look at the positive factors that March Madness has towards the economy it also brings in negative factors. Such as there is a decrease in productivity as according to Wallet Hub there is an estimated $1.9 billion loss due to the fact that there are unprotected workers. Because they are constantly checking their brackets as well as cheering for their favorite team. Which could then pose an negative externality because if one is cheering for a team other workers could then get distracted which could result in decreasing their productivity.

Yet productivity might be a big negative factor that stands within March Madness it's has more positive factors such as it boosts social activity at work and with friends by trying to get that next perfect bracket, brings in $1.1 billion in tv ads, projected impacts on final 4 host city 300 million, and the major impacts that it has on restaurants such as an 19% increase in pizza sales.

Works Cited

Kiernan, John S. "2016’s March Madness By The Numbers." Wallet Hub. Evolution Finance. Web. 20 Mar. 2016.

Ogus, Simon. "The Economic Impact Of March Madness From First Four To Final Four." Forbes. Forbes Magazine, 17 Mar. 2016. Web. 21 Mar. 2016.

Schwartz, Nick. "Duke Math Professor Says Odds of a Perfect Bracket Are One in 2.4 Trillion." For The Win. 17 Mar. 2015. Web. 21 Mar. 2016.

Economics of Spring Break

Kayla Holzhauer

Mrs. Straub

AP Economics

22 March 2016

Economics of Spring Break

After 4 months of snow shoveling, ice scraping, parka wearing and Netflix watching, the majority of us are ready to pack our bags and leave Wisconsin. When spring break rolls around in March or April an overwhelming number of us have already booked flights with warm weather on our minds. During the weeks of spring break many of us will leave our homes in search of a warmer climate, travelling everywhere from New York, to Myrtle Beach, to Cancun, to the Florida Keys. While the majority of us consider spring break to be little more than a holiday, it is the economic force for many seasonal businesses and a vital player in the macroeconomy.

So, just how big is spring break? Police Chief Drew Whitman of Panama City Beach, Florida estimates that the city’s population increases from about 12,000 to up to 250,000 during the spring break months of March and April (“Spring”). This is an overwhelmingly huge number of travellers, but the money generated is what really matters to the businesses of the popular spring break destinations. During spring break, “stores, hotels and restaurants in Panama City Beach saw over $170 million in economic benefit” (“Sea”). However, although these numbers appear great on paper, they don’t come without an opportunity cost.

The most obvious inconvenience to residents of vacation destinations is the overcrowding of beaches, hotels and restaurants created by travellers. The overcrowding also leads to other problems such as littering and pollution. The large amounts of excessive drinking often lead to minor crimes, accidents and arrests. In order to deal with these problems, the cities have to plan for cleanup costs and increased safety precautions. Of course, the costs barely create a dent in the benefits as “the spring break season accounts for 30 to 35 percent of some local businesses’ yearly income” (“Spring”).

The smaller economic benefits on local businesses are basic and obvious; but, when looking further into the economics of the spring break holiday, vacation spending is a significant player in the macroeconomy. Breaking it down, people generally save up their money for bigger vacations. After months of spending they are willing to splurge on their vacations, on everything from a beach condo to a new bathing suit and pre-vacation tan. This money that is moved from the consumer’s savings account back into the economy has an increasing impact via the spending multiplier. The tourist spending creates a flow of money that drives the economy. Furthermore, the nature of spring break can be used as a tool to determine how the economy is doing. In bad economic times less people are likely to splurge on extravagant vacations, especially college students. “If students are going on Spring Break and spending money that is a qualitative indicator that the economy is doing well” (Yakabe).

It is clear that the economy would fall behind without the push of Spring Break; and, while many of us prefer to view Spring Break as a chance to get away from real life, our search for paradise has significant real world application.

"Sea, Sun, Sand... and Revenue." Msnbc.com. 2004. Web. 21 Mar. 2016. <http://www.nbcnews.com/id/4428577/ns/business-us_business/t/sea-sun-sand-revenue/#.VvCVHFQrJdg>.  

"Spring Break! How Cities Prepare for an Increase in Tourists." Spring Break! How Cities Prepare for an Increase in Tourists. Web. 21 Mar. 2016. <http://www.governing.com/blogs/view/spring-break-how-cities-prepare-increase-tourists.html>.

Yakabe, Selena. "Spring Break Spending Boosts Economy." Sdsucollegian.com. The Collegian, 4 Mar. 2016. Web. 21 Mar. 2016. <http://www.sdsucollegian.com/news/article_0221f9a4-e08a-11e5-aea6-0752133eed07.html>.