Macroeconomic Variables of Walmart - Special Academic Support

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Walmart, one of the worlds largest retailers, owns sub-brands that manufacture products of different categories. Equate is a sub-brand that produces pharmaceuticals and cosmetic goods. Due to its affordable price and quality, Equate has stable sales of various drugs, but Ibuprofen may be considered one of the most popular medications among the population (Equate Ibuprofen tablets, 2021). According to the statistics presented in Figure 1, the share of annual sales of this drug is constantly growing, and in 2020, sales are over $7 million (Global Ibuprofen market revenue, 2021). At the same time, despite the demand among the population, certain factors can influence the share of sales of this product.

*Figure 1. Global Ibuprofen market revenue (Global Ibuprofen market revenue, 2021).*

In particular, individual macroeconomic variables can determine the supply and demand for goods of various profiles, including medications. As Rouksar-Dussoyea et al. (2017) state, such parameters as inflation, GDP growth, and unemployment are the dominant macroeconomic indicators to take into account. Golubtsova et al. (2019) note that these variables reflect the situation at the national level and allow for determining the degree of an individual countrys economic development. As a result, the dynamics of the market trade of various products, including Ibuprofen by Equate, depends on how high or low the proposed rates are.

While taking into account the trends in these three macroeconomic variables over the past years, the comparison of these indicators can help determine their impacts on the supply and demand of the product in question. In Table 1, the ratios of the indicators of GDP growth, inflation rate, and unemployment are presented, and this information is taken from a public source (Amadeo, 2020). These data are crucial factors that can be interpreted as those driving the potential supply and demand for Equates Ibuprofen.

The proposed data show that fluctuations in the selected macroeconomic variables are obvious. Changes in the parameters of GDP growth can be explained by external economic trends and the influence of individual economies on the US performance. A noticeable rise in the inflation rate is an alarming parameter, which also indicates a slight drop in the economic level in the country and the loss of stability of the national currency. Finally, a decline in unemployment, conversely, is a positive trend that indicates the expansion of the labor market and the provision of more jobs. These factors are essential to consider when planning sales and assessing supply and demand perspectives.

Due to a decline in the countrys GDP, market prices for drugs may rise, and Walmart will have to respond to these changes. This, in turn, is fraught with a decrease in demand and may be the result of a decrease in supply to exclude the emergence of surplus products and receive stable profits. Rising inflation can make Equates Ibuprofen more affordable, which may have a positive effect on supply and demand characteristics. The more consumers are willing to spend, the higher will be the supply from the manufacturer. Finally, a decline in the unemployment rate is another positive trend that determines the growth of supply and demand. Expanding the range of potential buyers will have a positive impact on the share of sales, and Equate will be able to expand its production by supplying more Ibuprofen to the market. Thus, the considered macroeconomic variables play a crucial role in shaping pricing policies and regulating supply and demand aspects.

References

Amadeo, K. (2020). US real GDP growth rate by year compared to inflation and unemployment. The Balance.

Equate Ibuprofen Tablets, 200 mg, pain reliever and fever reducer, 500 counts. (2021). Walmart. Web.

Global Ibuprofen market revenue. (2021). Market.Us. Web.

Golubtsova, K., Sahaidak-Nikitiuk, R., & Demchenko, N. (2019). Study of factors affecting on the development of the pharmaceutical sector enterprises. ScienceRise: Pharmaceutical Science, 2(18), 28-32.

Rouksar-Dussoyea, B., Ming-Kang, H., Rajeswari, R., & Yin-Fah, B. C. (2017). The economic crisis in Europe: A panel analysis of inflation, unemployment and gross domestic product growth rates. International Journal of Economics and Finance, 9(10), 145-154.

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