To Speed or Not to Speed

Alex Miller

Mr. Reuter

Economics

26 April, 2016

To Speed or not to Speed

There has long been debate over the speed limits throughout the U.S. ever since the oil shortages in the 70s. The action by the government was to reduce speed limits to 55 mph. This action helped to reduce the United States dependency on foreign oils and to help the environment.

Speed limits should be reduced again to 55 mph from 70 mph, not only to reduce dependency and save the environment but also to save lives and everyone money. The current speed limits in Wisconsin on major interstates is 70 mph and then 65 mph on state highways. This being said, no one ever really goes that slow, most travel about 75-80 mph. Everyone who does travel this fast is wasting money and gasoline. There is only one advantage to going this fast and that is to save time. What most miss out on or else completely neglect is the chance to maximize efficiency and save money. Here’s an example of how travelling the optimal speed can save you money, Let's take two hypothetical drivers, Bill and Bob. They need to go 60 freeway miles from City A to City B. Both cars get 30 miles per gallon if the driver stayed at 55 mph, the posted speed limit. Bill travels at 55, but Bob speeds and does 75 mph - wanting to get there sooner. At 75 mph, it would take Bob about 48 minutes to reach the destination. At 55 mph, it takes Bill about 65 minutes to reach the destination. At 55 mph, Bill used 2 gallons of gasoline. At $2.80/gallon, that's $5.60 to drive the distance. At 75 mph, Bob would use 2.5 gallons of gasoline. At $2.80/gallon, that would be $7.00 to go the same distance (“Speeding”). If Bill travels this distance to work everyday during the week he will save $14.00 a week. The only thing he would lose is a small amount of sleep. The trade-off between the private costs (fuel cost and damage and injury) and private benefits (time savings) is very large. There are also many external costs that come into play such as injury to others, health impacts and pollution. The costs far outweigh the benefits. All you gain is time, why gain time when you can gain money and ensure that you will be more safe.

Safety plays a very large factor in why speed limits should be reduced once again. The U.S. government reduced the speed limit to 55 mph in the 70s and 80s to help reduce fatalities in car crashes. Now that law is gone and speeds are higher than they have ever been. People on highways and interstates speed excessively, and it is becoming a major problem. In fact, “Speeding is a factor in 31 percent of all fatal crashes, killing an average of 1,000 Americans every month, according to the National Highway Traffic Safety Administration (NHTSA)” (“Speeding”). This means massive amounts of accidents must occur, and the cleaning up and repairing of both people and vehicles has a cost. It is probably a lot more than you may think, “The NHTSA estimates the cost to society of speed-related crashes to be more than $40 billion each year” (“Speeding”). In this Illustration it is seen that as the speed of vehicles is increased along the x-axis, the number of crashes that occur increases as shown by the points along the graph. Along the y-axis it can be seen that as speed increases and the number of crashes occurring increases the percent killed in the accidents increases as well.

All the benefits that come with reducing the speed limits are great for the economy and will help improve the standard of living here in the United States. If trucking and airline companies aren’t afraid to slow down, we shouldn’t be either. It will save everyone money, so everyone should try to change the lead in their right foot into gold in their pocket.

Works Cited

Castleman, Tim. "55 MPH Speed Limit Makes Economic, Political, and Environmental Sense." USA News. USA News, 27 July 2009. Web. 25 Apr. 2016.

"Speeding and Your Vehicle's Mileage." Speeding and Your Vehicle's Mileage. California Energy Commission, n.d. Web. 25 Apr. 2016.

Summerfest is Arriving

Kristie Tabbert

Mr.Reuter

Economics B2

24 April 2016

Summerfest is Arriving

Summerfest is one of the biggest music festivals in the United States. While 65 days to opening day seems to be too long to wait for, people of all ages are eagerly buying their concert tickets and power passes. People from all around the country and unified by one thing they have in common, music. Milwaukee’s tourism rates constantly increase each year as Summerfest becomes more popular.  One year “Summerfest officials said anywhere from 5,000 to 7,000 people were let in without tickets. Estimates were as high as 117,000 people that night at the festival” (Walker). Admission estimates will most likely be higher this year as well because of the line up. This year the lineup is very country, which seems to be the top favorite for many Americans. Making Summerfest a demand on people’s summer bucket lists.

While people spend hours walking the grounds per day they are also spending lots of money to feed their needs. The average net income per year is about $12.4 million, making the profit at the end of the year about $364,000. All these sales and purchases increase the GDP of The United States.  Without consumers Summerfest wouldn’t be able to make a profit. They also wouldn’t be able to make a profit if the line ups weren’t any good. Consumers aren’t going to pay $20 + dollars to see a band that they don’t want to see. This year the admission prices have already increased to $20 and all concessions are said to go up another 8% as well. With these increases the profit of Summerfest is going to increase more than it ever has before.

Older people don’t consider going to Summerfest as much as they used to. It’s being taken over by younger college and high school students. Many adults don’t want to deal with drunk students so their demand to attend the festival has gone way down. While the atmosphere of this festival is taking a turn to appeal to younger kids the effects of this festival is great for the Milwaukee area and Wisconsin as a whole. Now, all we have to do is patiently wait until opening day to see our favorite performers.

"Home | Summerfest, The World's Largest Music Festival." Summerfest. N.p., n.d. Web. 24 Apr. 2016.

Walker, Don. "Summerfest Reports Attendance Was up at This Year's Festival." Jsonline. N.p., July 2013. Web. 24 Apr. 2016.

Brewers Effect on the Economy

Drew Barth

Economics

Mr. Reuter

04/19/2016

Brewer’s Effect on the Economy

Baseball is back, and all baseball fans are excited for the upcoming season. The Brewers as of recent years haven’t been one of the top performing teams in the league, but Milwaukee and Wisconsin in general are baseball people. With close to 2 million people in attendance each year baseball is very popular in Milwaukee. The Brewers do great things for the community and the local economies around them due to their popularity. While baseball is just a game, the economic significance to the area and state are extraordinary!

In recent years the Brewers have grossed 356 million dollars. This roughly calculated to 1.5 percent of Wisconsin’s real GDP. As well, the Brewers bring in close to 4,400 jobs for people surrounding Milwaukee. This is a great employment booster for the local area. Within the 5 counties that pay taxes for Miller park Waukesha, Milwaukee, Ozaukee, Racine, and Washington they pay a tax rate of .01% of every purchase made in these counties. The .01 that was added to the 5 counties taxes was well worth the economic booster that Miller park provides. Due to their need of staff they have great employment numbers, they are the thirteenth highest employer in Wisconsin. However, all of the jobs that the Brewers have are seasonal jobs ranging from April through September in most cases (Not including playoffs).  There is 81 games in Milwaukee during a regular season, all 81 games help Milwaukee and confirm the wise decision it was to fund the construction of Miller park.

While the Brewers do help provide jobs and a big business in Milwaukee, they also support businesses in the community.They are not just some organization helping themselves out, they are an organization with the goal to better Milwaukee. In the chart below it shows the attendance demographics, and where these people that come to games are from and their impact on local businesses.

As can be seen above, 57% of the Brewers attendance are out of area visitors. Of that 57%, 30% stay overnight at local hotels. If these people just stay over for one night they will spend on average $127.33 not including hotel and tickets to the game. This all supporting local businesses and tourism in Milwaukee County. With daily visitors, overnight visitors, employees, and the Brewers spendings the Brewers have a $292,485,343.68 output impact on the direct economy of Milwaukee.

In conclusion, the Milwaukee Brewers might not be the most athletically gifted team in the MLB, but they sure do know how to draw a crowd. This crowd doesn’t just help the Brewers as a business, but it helps other businesses in the area. The Brewers generate tourism, hotel stays, and employment for the Milwaukee area. Milwaukee has gotten a return on their investment, they have a team that makes the city great! A city like Milwaukee wants a professional team to create opportunities for the rest of the city, and their is no doubt that the Milwaukee Brewers accomplish that.

Works Cited

      "Economic Impact of Transgenic Crops." SpringerReference (n.d.): n. pag.The Economic Impact of the Milwaukee Brewers. UWM. Web.

"Miller Park's Economic Impact." Miller Park. Journal Sentinel, n.d. Web.

Avengers: Infinity War

Sarah Calderon

Mr. Reuter

Economics B2

26 April 2016

Avengers: Infinity War—Soaring Budget

In the movie business, blockbuster films have to shell out big bucks to fill theatre seats. One film company has been known to spend millions upon millions of dollars—Marvel. Recent Marvel films such as Avengers: Age of Ultron, had a budget of nearly $250 million. However, the company has exciting, and expensive, plans for future films: the next 2-part Avengers film, Avengers: Infinity War, scheduled to be released in 2018 and 2019, will possibly have a budget of nearly $1 billion dollars! The company's thinking is to make a larger profit—they spent almost $250 million on the last Avengers film and made a billion in ticket sales. By putting more money into both Part I and II of Infinity War, they hope to come out with hefty profit of $4 billion.

So where’s all this money going to anyway? An article released by The Guardian explains what really goes into making a movie; its “anatomy”, as Sean O'Connell mentions, is more than simply shooting the movie. It’s writing the script and developing the film’s story-board ($10 mil), paying the producers ($15 mil) and director ($10 mil). Let’s not forget the cast ($30 mil) and production crew ($45 mil). Then there’s special effects, which in the article describing Spiderman’s cost, was upwards of $65 million. However, this is the expense that Marvel will increase for the last Avengers films. While the movie industry has always set aside the majority of their editing budgets for special effects, a $1 billion dollar budget could possibly result in a $260 million editing budget; so even though movie tickets are a fairly elastic product since they’re not a necessity, isn’t knowing that they’ll have the best effects of any Marvel movie ever made enough to make you want to see it? Especially when realizing that ticket prices will still be the same? Marvel knows this, and by increasing their budget dramatically, they hope to increase the demand for their latest films.

This increase in spending isn’t just for creating digital scenery and amping up explosions or destruction either; it’s the costumes, lighting, makeup, etc. that really bring your favorite heroes to life. Costume designers spend countless hours creating costumes (and extras, just in case), all while ensuring that it matches up to Marvel comics fans expectations—ones who might otherwise be disappointed if their Avengers heroes aren’t portrayed right. With this knowledge that details of their work could affect consumer taste, costume designers have to be meticulous in researching what the costumes should look like, while ensuring that they look good on camera. There are also dozens of makeup artists, all of which have to spend time making the cast camera-ready, in some cases even creating prosthetics.

As you can see from the photos above, creating prosthetics, even for a character with only a few minutes of screen time like The Vision in Avengers: Age of Ultron, is an extremely tedious process (and a costly one). Just applying the makeup to the actor or actress can take up to 3 hours, an investment movie companies are willing to make in order to make their heroes truly come alive on-screen. Overall while Marvel’s heroes, as well as their budget, soar skyward, the promise of increased revenue along with excited Marvel fans seems worth the risk.

Works Cited

O'Connell, Sean. "The Supposed Avengers: Infinity War Budget Is Almost Shocking." Movie News. Cinema Blend, 09 Oct. 2015. Web.

20 Apr. 2016.

Thomas, Archie. “Anatomy of a Blockbuster.” Movies. The Guardian, 10 June 2004. Web. 24 Apr. 2016.

MLS on the Rise - Nathan Moran

Nathan Moran

Mrs. Straub

AP Economics - Insight

April 25, 2016

MLS on the Rise

Soccer, or known in most other countries as football, is the world’s most popular sport. It leads by a large margin over the next sport with over 3.5 billions estimated fans. With that being said, soccer lacks the support here in the United States. The MLS severely lacks the following that other sports in the US get like the NFL, NBA, MLB and NHL but it is definitely on the up and up. Due to the amount of kids that are and have been getting involved with soccer the popularity grows with them. Kids that played soccer as kids and are becoming adults are attending games and supporting teams. This often leads parents to get involved as well only to slowly start the landslide effect of popularity for the sport.

The demand for soccer memorabilia and tickets is on the rise. The Portland Timbers, a MLS soccer team, sells out almost every soccer game they play at home. This is a huge change from teams struggling to fill the lower bowl. It was announced at the beginning of the season that the season ticket holder renewal percentage for the Timbers was at 98 percent. That kind of renewal percentage is completely unheard of. It is true that the price level for the MLS is not as high due to the MLS not being as popular as other leagues but season tickets are still not cheap. Some of the most popular American football teams struggle to reach 90 percent.

As the MLS gains popularity there is a demand for additional teams in different cities. Minnesota and Atlanta are the planned 21st and 22nd teams to join the MLS. Atlanta is even funding a new stadium to house not only Atlanta United FC but also the Atlanta Falcons. Other cities are also on the hunt to get a MLS team. Los Angeles is set for another team come 2018. Also, Miami is looking to add a team in 2018. The new news that is coming out is that the owners of the Detroit Pistons and Cleveland Cavaliers are going to come together to get a team in Detroit.

In the short run you can see that the MLS is gaining traction and popularity throughout the United States in a variety of different ways. When it comes to the long run who knows what will happen, but if the trend continues, the MLS could become one of the more popular leagues in the United States.

Works Cited

Gallivan, Joseph. "Bring the Noise, Bring the Paint." Oregon Local News. Pamplin Media Group, 7 Mar. 2016. Web. 25 Apr. 2016.

"Expansion." MLSsoccer.com. MLS, n.d. Web. 25 Apr. 2016.

Is Germany Destroying the Rest of the Eurozone Economies? - Aidan Borre

Is Germany Destroying the Rest of the Eurozone Economies?

For the past decade Germany has become a major exporter and an economic super power. Some of Germany’s top exports are vehicles, pharmaceuticals, and mechanical parts(Workman). Germany was ranked 4th for the highest GDP in the world and in the past decade has shown a trade surplus. The country's economic policies are seem to be unrivaled and in the aftermath of a slowing Chinese economy Germany has managed to fill the void in supply left by China. However this doesn’t come without consequences.

As we know a country can’t produce at a surplus without another country experiencing a trade deficit. The country that has been given the short end of the stick due to Germany’s surplus was Greece. Germany has lent Greece money in the past to help make up for their trade, but now they are asking Greece to pay. However, Greece can not possibly pay Germany back as Greece has only posted a small trade surplus within the last three years as shown by the graph, and now in post economic collapse with no sign of recovery Germany may be waiting for quite some time for repayment. Without change in Germany’s economic policy the condition of the macroeconomy in the eurozone will continue to worsen.

Now you may be wondering how could you possibly come to a solution that fixes the economic problems of the eurozone as well as not disrupt the German economy. One solution rejected by Germany was to decrease Germany’s exports allowing Greece an opportunity to create a larger trade surplus and create economic growth. To address Germany’s loss of foreign trade it would be necessary for them to increase domestic consumption. To do this it would be necessary for the German government to increase government spending or to cut taxes, which since the government is currently operating with a surplus would be fiscally feasible(Mattich). This plan would allow the rest of the eurozone economies to stabilize while Germany continues to enjoy the benefits of going a decade without a trade deficit. However as well as this plan could work Germany has showed no signs of moving away from its foreign trade, and with multiple nations headed for elections it appears as though their will be no chance to change this in the next couple years(Associated).    

 

The Associated Press. "The Latest: Obama: Time Not on Side of US-Europe Trade Deal." ABC News. ABC News Network, n.d. Web. 26 Apr. 2016. <http://abcnews.go.com/Politics/wireStory/latest-german-minister-us-budge-trade-deal-38629899>.

Workman, Daniel. "Germany's Top 10 Exports." Worlds Top Exports. N.p., 24 Mar. 2016. Web. 26 Apr. 2016. <http://www.worldstopexports.com/germanys-top-10-exports/>.

Mattich, Alen. "Why Germany's Record Surplus Isn't Helping the Eurozone."WSJ. N.p., 9 July 2015. Web. 26 Apr. 2016. <http://blogs.wsj.com/moneybeat/2015/07/09/why-germanys-record-surplus-isnt-helping-the-eurozone/>

Is Golf a Dying Sport? - Ryan Stoffield

Ryan Stoffield

Mrs. Straub

Ap Econ-Insight

April 25 2016

Is Golf a Dying Sport?

A game that’s been around for centuries seems to be dying. The game that promotes integrity, patience, and discipline is having a hard time recruiting new players. Golf has been a sport that in the last 10 years has been significantly declining. Many courses are closing and even prestigious clubs are having to open to the public just to stay alive. There are many reasons why golf isn’t the perfect sport for the 21st century American, the time and the money just to mention few. Although the numbers in retail and annual play are down, don’t say golf is dead yet it has been around for about 500 years.

Overall the demand to play golf has been going down. Because of this the amount of profits the golf courses are making are going down.  The demand in the game of golf in recent years has been based on one golfer. The rise and fall of Tiger Woods and his dominance on the PGA Tour has a correlation between the amount of interest in the game (Greenfeld).  As you can see on the chart the highest demand for golf was in 2005, Tiger’s peak.  Tiger not only drew more interest to the game he also inspired thousands of young players to play the game. Not only has Tiger’s impact stayed in the United States, it has expanded to hundreds of other countries in their pursuit of the game. Without one of its most important influencers playing his best golf is going to need to find someone new who can push the game forward.

Another area of the golf industry that is struggling is the golf retail business. Large companies have had to lay off workers or file for bankruptcy because consumers don’t have the interest in the game. In addition to the lack of interest the overall price level on many of the things in golf is very high.  Many golf companies launch new and improved products each year which raises the price of these products (Germano). Golf retail stores like Dick’s Sporting Goods are cutting the space that golf holds in their stores and using the space for other revenue producing products.  

Although there are the negatives when it comes to playing golf such as the time and monetary commitments players must devote to the game technology is on golf’s side. One of the latest advances in the game has been TopGolf. TopGolf is the combination of a restaurant, bar, and driving range all in one. Best of all each golf ball is programed with a microchip and can be tracked to the multiple targets in the hitting area.  Players can compete with each other in a fun and competitive setting.  Some believe that TopGolf is the game's new Tiger Woods and will regenerate the demand for the game (Greenfeld). Another important fact to notice is that 54% of TopGolf’s customers are between the ages of 18 & 34. TopGolf has been able to draw the younger client into the game something only Tiger was able to do.  

Overall the status of the game will depend on how this generation of millennials accepts the game. The new advances in technology and an improving economy should help the game of golf in the short run but whether it will last unknown. Companies like TopGolf and others making the game more fun aren’t letting the game of golf die. The game is in a slump right now, but it will recover well and adapt to this new technology with improved technology offered on the course drawing more demand and interest to the game. Golf isn’t dead just yet.

Works Cited

Germano, Sara. "A Game of Golf? Not for Many Millennials." WSJ. Dow Jones & Company, 1 Aug. 2014. Web. 25 Apr. 2016.

Gray, Robert D. "Topgolf's Appeal to Millennials Catches Sport's Eye." SportsBusiness Journal. American City Business Journals, 27 Apr. 2015. Web. 25 Apr. 2016.

Greenfeld, Karl Taro. "The Death of Golf." Men's Journal. Men's Journal, 2016. Web. 25 Apr. 2016.                                               

                                      

Economics of the NBA Finals - Collin Olsen

Economics of The NBA Finals

This past weekend marked the start of the 2016 playoffs which will continue until the middle of June. Incredible matchups between teams will be happening constantly until only two teams remain, and many think these two teams will be a rematch of last year between the Cleveland Cavaliers and the Golden State Warriors. Considering the Warriors broke the record for most wins in the regular season and the Cavaliers are still dominating the eastern conference this matchup wouldn’t be much of a surprise, but it would still have a major economic impact on both teams and players.

Last year before the NBA Finals the Warriors team value was about $1.3 billion, but now it is currently evaluated at $1.9 billion (Forbes). This nearly 50% increase in value can do a lot for a team, and more importantly the area around it. Many people forget that any professional sports team is a major part of a city’s identity both socially and economically. For example businesses around the arena will most likely increase their profits because of the increase in attention to the area. In addition to this more businesses will realize this and want to make investments for their businesses in that area to take advantage of these profitable opportunities. This trend will likely continue if the warriors can continue their playoff success and get put into the conversation for ones of the best teams in NBA history.

The Finals also had a large impact the players of these two teams. None more so than Stephen Curry. According to Repucom, a large social analytics firm, Steph became the top ranked NBA player on appeal, and was ranked third on people recognizing his name behind only Lebron James and Kobe Bryant. With his astonishing regular season this year these stats most have increased even more, which would in hand increase demand. This would also increase the price level for his products because of the rising popularity of his name.

One last major impact of the NBA Finals is on the TV station. For the last few years ABC (which is owned by Disney) has bought out the rights for the NBA finals and many other playoff series. This is a pretty safe investment for them considering the magnitude of the event, but last year it really paid off for them with the best ratings for the finals since Michael Jordan played. As the supply of basketball begins to fall more viewers typically funnel into the biggest series of the year, in fact last year there was an average of 19.2 million viewers per game throughout the 6 game series, which was an increase of about 25% from the year before (Forbes). If the series does end up being between Golden State and Cleveland ABC could undoubtedly advertise it as one of the greatest series of all time. With the phenomenal regular season accomplishments of the Warriors as they are seeking a repeat championship they are faced against a revenge hungry Cavaliers team led by Lebron James, which was also plagued by injuries during their playoff run last year.

Overall no matter what teams play in the Finals this year there will be a great financial impact for the teams, players, and the companies behind the scenes. However if it does come down to a rematch of last year then these impacts will become even larger, and might even break some records for TV ratings. Without this large championship at the end of the season there would be far less profits in the NBA, which shows how everything put into it can financially change the outcome of the league.

Works Cited

Badenhausen, Kurt. "2015 NBA Finals: Winners And Losers." Forbes. Forbes Magazine, 17 June

2015. Web. 19 Apr. 2016.