Micro and macro economics Essay Example | Topics and Well Written Essays - 2500 words

Micro and macro economics - Essay ExampleA rosy business environment delegacy that spinal fusion forecasts indicated that the combined party bequeath be able to create a profitable synergy. The synergy included combining the marketing and management strategies of dickens companies. Since the two companies were economically profitable prior to the January 2001 merger, all business predictors expected that the combined confederacy will be able to generate additional revenues that will surpass the combined revenues and profits of each of the two merger companies combined (Lipsey, 2007). In fact, the merger was a huge projected gamble at $348 one million million million investment money on the line. Both America Onlines founder, Stephen Case, and date Warners chief executive, Gerald Levin, had very high hopes that the merger will bring much revenues and profits to the new giant play along, the merged entity cropping up from the two companies. The merger was expected to generat e an equal share in the shareholders dividends. The board of directors of each of the two combining companies was expected to vote equally on all business decisions of the combined company (Hoskisson, 2005). Question 2 Both companies had similar motives for ensuring the success of the merger. Time Warner entered the merger in order to enhance its benefits from both the supply equation and demand equation (Microeconomics). Similarly, America Online entered the merger in order to enhance its prove benefits from both the supply equation and demand equation (Hirschey, 2005). Additionally, Time Warner joined the merger to enhance the companys macroeconomic environment. The companys macroeconomic goals included improving its total economic activity, especially in the area of proceeds. The companys other macroeconomic goals included the successful resolution of the obstacles of inflation. Further, the companys macroeconomic goals included contributing to the reduction of the nations unem ployment rate (Hall, 1997). Similarly, America Online vigorously entered the merger in order to enhance the companys macroeconomic environment on January 10, 2000. The companys macroeconomic goals included improving its total economic activity, especially in the area of growth (Tucker, 1997). The companys other macroeconomic goals included the successful resolution of the obstacles of inflation (Khoury, 2003). Further, the macroeconomic goals of Time Warner and America Online are geared towards contributing to the value of the nations economy. The nations economic indicators include gross domestic production. The nations economic indicators include international trade. The merged companys global market included clients from outside the United States. The merger between Time Warner and America Online occurred on January 2000. The merger was considered as one of the largest merger s in United States history. The merger involved an estimated $348 million. America Onlines founder, Step hen Case, was proud with the merger. Likewise, Time Warners chief executive, Gerald Levin, felt that America Onlines formidable internet presence would catapult America online to greater financial profit heights (Hoskisson, 2005). After the merger was consummated, the new merger focused on reducing the number of redundant employees. With the retrenchment, the number of unemployed United States citizens ballooned to unfavorable macroeconomic levels. Today the combined value of the two companies, Time Warner and