# Economics Project Questions

Economics project questions on investments, relative income basic data and projection, stock market , comparative macroeconomic performance and liquidation of investments.

#### PROJECT  1:INVESTMENT

You will be investing  own  money in the real world. So why not start right now ? Well at least with imaginary money. That could be a helpful  experience afterwards. You will be choosing  10 stocks, and will be investing  10000 dollars in each of them. Who knows your choice might turn out to be a gold mine, to the amazement of yourself.  We will find about that  towards the end  of the Course when  you will be required to sell whatever  you are buying now.  So don’t forget  to save your work.

Try to provide Information in the following manner.

MARKET  DATE   ____________      refers to  first Friday of the Semester. Place on   the left margin.

DOW-JONES.  _________  refers to   Adjusted  value of DOW-JONES for  the MARKET  DATE.

Place below MARKET  DATE  .

Next, construct a Table titled  STOCK  PORTFOLIO  with Columns as under:

COLUMN  1:   COUNT       (e.g.  1,2,3,…up to  10)

COLUMN  2:   STOCK        (enter  10 stock names  of your choice in alphabetical order)

COLUMN  3:   BUYING PRICE         (enter  end of the MARKET  DATE  stock  price; NO ROUNDING)

COLUMN  4:   AMOUNT      (enter  10000 against each stock)

COLUMM 5:    QUANTITY  (enter the result of Column (4) divided by Column (3).

Keep  two digits after the decimal. Make sure to round the last digit.

For instance, if the quantity is calculated as 128.3783, enter  128.38

#### PROJECT  2: RELATIVE  INCOME :  BASIC  DATA

Countries widely differ in the growth rate in per-capita real GDP. We also know  that Countries growing the fastest will eventually be the richest. Now an interesting issue is how the future would  look like if the recent growth pattern continues far ahead? This is what we will try to ascertain in a limited way in this Project and subsequent two Projects ( Project 3 and Project 4). Remember that in the real world, future growth rates might deviate a great deal from the current rates. So our results have to be taken with a grain of salt. Nonetheless, they might be an eye-opener. Here is how we plan to proceed.

(A) Choose two  Countries  from  Bangladesh, Ghana,  Nepal, Panama, and  Sudan.

(B) Compile following information for  USA,  CHINA, INDIA  and  the two chosen  Countries .   (1) Per Capita GDP ( PPP )  for the latest year  labeled  as  GDP

(2) Per Capita Real  GDP growth rate for the latest period   labeled  as   gGDP

For information on the  Internet (Google ):

Enter:      LIST  OF  COUNTRIES BY  GDP ( PPP ) PER CAPITA –  WIKIPEDIA  for the variable  GDP.

NOTE : Use  International Monetary Fund (2020 ) Estimates

Enter :   LIST OF COUNTRIES BY  GDP ( REAL )  PER CAPITA   RATE-  WIKIPEDIA  for the variable   gGDP.   NOTE :  Use figures  under the Column  2010-2018  annual growth

(C) Now  Enter gathered information in EXCEL following the format indicated below

cell  A1  enter  COUNTRY

cell  B1 through  F1  enter Country names  :  USA in B1,  China in  C1,  India in D1, and   next your two chosen  Countries in E1 and F1.

cell  A2  enter  GDP

cell  B2  through  F2 :   enter  GDP  figures for corresponding Countries .

cell  A3  enter  gGDP

cell  B3  through  F3   enter  gGDP  figures for corresponding Countries.  When you enter the figures, eliminate the percentage sign %.

#### PROJECT  3 : RELATIVE  INCOME : PROJECTION

Continue from  PROJECT 2.

row  5 leave Blank

cell  A6  enter  YEAR

cell  B6 through  F7,  leave Blank.

cell  A7 enter   0

cell  B7 enter   GDPp  ( per capita GDP ) of  USA

cell  C7  through  F7 :  enter  per capita  GDP figures of corresponding  Countries, as for instance, that of  China  in  C7, and  India in D7.

cell  A8 :  write the equation    =A8+1  then  click Enter,  next drag it up to the number   50

cell  B8  through  F8:  This time we will have to input the actual values of  B4,  C4,  D4 and so on in corresponding Equations. Let us illustrate with hypothetical numbers.  Let  B4  equals  .015, and  C4  .085. Now

cell  B8 =B7*(1+.015)  and then click  Enter

cell  C8 =C7*(1+.085) and then click  Enter

cell  B9  through F9 : Again we will have to input actual values of  B4,  C4,  D4  and so in  the corresponding equations.

Cell  B9  = B8*(1+.015)     click enter and next drag up to the year  50

Cell  C9   = C8*(1+.085)   click enter and next drag up to the year  50

ROW  58 leave blank

cell   A59 enter     INITIAL

cell  B59 leave blank

cell  C59   through   F59.   Here our objective is to ascertain what was each country’s per capita GDP as percent  of  that of USA in the initial year. Therefore,

cell  C59 Enter the Equation =(C7/B7)*100

cell  D59 Enter the Equation =(D7/B7)*100 and so on.

cell  A60 enter    TERMINAL

cell  C60  through  cell  F60.  This time we would like to find out what would be  each country’s  per capita GDP as percent  of that of USA in the terminal  year .

cell  C60 Enter the Equation =(C57/B57)*100

cell  D60 Enter the Equation =(D57/B57)*100  ;  and so on.

When you submit  PROJECT  3, make sure that you have attached PROJECT  2 as well.

#### PROJECT  4:  RELATIVE  INCOME  PROJECTION:  REPORT.

Attach   PROJECT  3.

Write a report  based on your findings in Project 3. Make sure that it is interesting to read. As you know, figures corresponding to the Row  INITIAL  gives each Country’s per capita GDP as percentage of USA in the  starting  year, while that of   TERMINAL   A   gives each Country’s per capita GDP as percentage of USA  for the final year. TERMINAL  B  figures refer to each Country’s per capita GDP as percentage of USA, again for the  final year,  given  that USA income grows at a higher  rate assumed by you under  USA  2.

Tell us about relative USA position now, and how it might look some 50 years  ahead.  Could it be that some  Countries might  overtake USA?  Who are they,  and  in how many years? How rich they will be compared to us?

#### Project   5:  STOCK MARKET DIARY.

We have studied how a  Market does function. We have also noticed that prices do not remain fixed. They move in response to changes in supply and demand. Response of price to unfolding events and expectations  is extremely rapid  in the market for financial assets like stocks. Our main task  is to identify news items that might have impacted the Stock market in a particular day. We will use

Dow-Jones Industrial Average, commonly referred to as Dow-Jones or simply Dow, as representative of the Stock  Market.

Now proceed as follows:

Choose a week within the Semester.

Collect information on Dow-Jones Industrial Average ( Dow, Dow-Jones) for each working day of  the week you have chosen .

Present  data in a TABLE titled MOVEMENTS IN DOW-JONES DURING THE WEEK as under Change over Change in

Date Close the Day percentage

Next, indicate separately for each working day of the week, what specific  economic   events  or news  might have  caused the Dow-Jones to move the way it did. Write a short but informative paragraph for each working day. You will find required  data for the Table as well as needed information for your writing in Business Pages  of the Philadelphia Inquirer. You may  consult other sources  like Wall Street Journal for extra  credit; in case you have done so, don’t forget to identify the source.

#### Project 6:  COMPARATIVE  MACROECONOMIC  PERFORMANCE

Choose a  Country  from France, Germany, Italy, and UK.

Present information for the latest available year  as outlined in Table 1 below. Write the name of            the Country of your Choice in the Column labeled  ( Choice ). For data go to WORLD FACT BOOK    the  same way as in PROJECT  2. Look for  relevant information under  ECONOMY Section of the Country.

TABLE   1 COMPARATIVE  MACROECONOMIC  DATA

( all figures are in percent)

Particulars    USA     Canada Japan    Russia        (Choice)

Unemployment rate

Inflation rate

Growth rate in real GDP

#### Project 7:  REPORT  ON COMPARATIVE  MACROECONOMIC  PERFORMANCE

Now write a report in as much detail as you can comparing macroeconomic  performance of USA with other rich Countries based on PROJECT  6 information. Make your narrative interesting and easy to read for an ordinary person. Enrich with your own observations for extra credit.

#### Project   8:  STOCK MARKET DIARY.

Same as  Project  5 but for a different week within the Semester.

#### Project  9 :  LIQUIDATION  OFINVESTMENTS

You have bought  stocks earlier (PROJECT  1).Now you will be selling your holdings. Construct a Table captioned  LIQUIDATION  OF  HOLDINGS as below :

COLUMN  1:     Same as COLUMN  1  of  PROJECT  1

COLUMN  2:     Same as COLUMN  2  of  PROJECT  1

COLUMN  3:     Same as  COLUMN 5  of PROJECT  1

COLUMN  4      SELLING  PRICE. Enter price as on last working day of the  12th week of the semester .

COLUMN  5:    PROCEEDS Enter the result of COLUMN  3 multiplied by  COLUMN  4. Add up all the values and write  down the Total figure at the end of the Column.

COLUMN  6:   GAIN OR LOSS

IN PERCENTAGE Calculated as:  (each  COLUMN  5  figure minus 10,000) divided by 100.     Add up all the values and next divide by 10. Enter  this figure as Column TOTAL.

#### Project  10 : ASSESSMENT  OFINVESTMENT  PERFORMANCE

Now that you have liquidated your holdings, it is time to assess how well you have done as an investor.

Construct another Table titled   RELATIVE MOVEMENT IN DOW-JONES   as below :

Change in

Date Value Change  percentage

Column 1 Column 2 Column 3 Column 4

Project  1

Project  9

Under  Column  2  enter corresponding  Dow-Jones figures as in Project 1 and further in Project 9. In Column  3   enter the result of   Dow-Jones  Project 9  minus  Dow-Jones Project 1.  In  Column  4 enter the result of   ( Column 3 divided by Dow-Jones Project 1 ) * 100.  You have made money if the Total under COLUMN  6 in Project  9 is positive. But that is not enough. You have to compare your performance with that of the Market.  Your performance will be rated as outstanding if you can beat the market, that is to say COLUMN  4 figure of the above Table is lower than the Total under COLUMN  6 in Project  9.