Environmental Analysis Ã¯Â¿Â½ PAGE \* MERGEFORMAT Ã¯Â¿Â½8Ã¯Â¿Â½
Running head: ENVIRONMENTAL ANALYSIS
University of Phoenix
The purpose of this paper is to identify key macroeconomics variables that affect a particular industry, in which two of these variables will be selected and reflected in two charts, each to include the macroeconomic variable and the corresponding industry variable for the last five years. Based on the environmental scan, the challenges and opportunities that exist for the firm within their operating environment.
The banking industry plays a crucial role in today's economy, wealth is not created solely by banks such as Bank of America, but by the strength of the banking industry as a whole which is linked to the health of the economy. The purpose of this paper is to identify the key macroeconomic variables that affect the banking industry and to address the challenges and opportunities that exist for Bank of America within their operating environment.
In our economy, every industry is impacted one way or another by macroeconomic variables. The four macroeconomic variables that impact the banking industry are Gross Domestic Product (GDP), unemployment, interest rates and inflation. These macroeconomic variables affect components within the organization's external environment, the remote environment or macroeconomics, the industry environment, and the operating environment.
According to McConnell and Brue, p.112, GDP is "the primary measure of the economy's performance is its annual total output of goods and services or, as it is called, its aggregate output." GDP plays an important role in the success of banks. The banking industry may be thought of as the engine that powers our economy. The engine is important, but without air constantly circulating, it will not continue to run smoothly. This is the same principal with the money in...