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lissa Bayona

AP Macroeconomics

December 4, 2016


Apple\'s Effects on the Economy

Apple is one of the largest companies in the world. It is the most valuable brand in the nation. Apple is worth $118.9 billion. During its first quarter in 2014, Apple made more than Amazon, Google, and Facebook all combined. Apple could pay in cash for Disney or Coca-Cola. During 2011, the U.S. treasury reported $73.7 million as the operating cash balance, whereas  Apple reported $76.4 million as theirs. Apple\'s annual sales during 2010 were $65.23 billion, leading to the fact that if Apple were its own country, it would be 68th largest in the world. In 2009, Microsoft, a competing company, spent $8.7 billion on development and research, and Apple spent a small fraction of that, $1.7 billion. Microsoft spent $17 billion on marketing, sales, and general spending, compared to Apple, which only spent $5.5 billion. Despite Microsoft spending a significant amount more than Apple, Microsoft did not have much growth and had smaller sales. All of these facts that most people in the general public are not aware of solidify the fact that Apple is such a dominant company and without it our economy would not be what it is today. It also demonstrates that Apple has a large effect on other companies and their efforts to keep up with the technological advances it comes out with.  

Apple is a company that has been around for at least 30 years. Some people think that it is a newer company that just began creating products recently, but they have actually been creating, producing, and selling for years.the creators of Apple are Steve Jobs, the most famously known, Steve Wozniak, and Ronald Wayne. Initially Apple was a company that was created to sell laptops and computers, but over time, they would begin to sell other things as technology advanced and the demand for bigger and better things increased. The company was selling as expected and then when a new member was added to the team, John Sculley. He was part of the reason that Jobs would leave the company that he co-founded. He would return to the company later and attempt to fix the downfall that occurred during his absence. Jobs would have to ask Bill Gates, the founder of a competing company, for a loan to get his company back to what it was once. He would use this money to pick up the company and use it to advertise already created products. Eventually the company would begin selling more and making more money. After this Apple would step it up, creating the iPhone, iPod, Apple Watch, and Mac. The unveiling of these gadgets caused huge roars.  

With the unveiling of iPhone 6, many people were extremely interested and excited to purchase the newest iPhone. When Apple made the announcement, many people made plans to wait in lines that were extremely long. The iPhone is by no means cheap. Most people are lucky to buy one at around $600, when you include all of the fees and charges that phone companies charge to install the phone. That amount is by no means a small amount, meaning that eventually when you add up all the iPhones that have been purchased, it can big a bigger amount than most people would expect. The economy depended on people to buy the iPhone 6, knowing that it would make tons of money, and it did exactly that. Electronic stores, such as Best Buy, saw a 3.4% increase in sales during the month the iPhone 6 was released. During that same month, clothing stores took a 1.2% decline in their sales. This is likely because people were either saving up their money because they knew that the new iPhone was being released soon or because people had already spent all the money they had saved up on a pricey iPhone. A U.S. economist that works for Chase Bank said that these iPhone sales added one-third and one-quarter of a point to the U.S. GDP growth. This is beneficial to the U.S economy because when the GDP goes then the economy and the nation as a whole are generally doing better. This demonstrates the amount of time, money, and effort people are willing to put into something just to keep up to date with technology.  

Another topic to be discussed with Apple is their main competitor, Android, created by Google. Android can be considered a substitute good, which is a good that serves basically the same purpose as another good. Androids serve the same general purpose as all other phones, such as calling, texting, emailing, and using the internet. It’s the other things such as the layout, customization abilities, the material the phone is made out, the charger, and countless other things are what makes the choice so hard for some people. People also buy Androids because of the price of iPhones. The prices can extremely expensive, and many people see this as a reason to avoid Apple all together. There are also other substitute goods, such as Blackberries, Microsoft, HTC, Sony, Nokia, and LG. People often turn to these alternatives because of the above reasons or ones similar.  

Apple also makes accessories that bring in large amounts of revenue and has iTunes, which is the only legal way to download music. Apple sells various different types of accessories for all their products. They sell cases for iPhones, cases for iPads, chargers for all of the products, cases for Macs, headphones, and several different other things. All of the prices that they sell these products for are often seen as expensive and over-priced compared to others. In the beginning of 2013, Apple says there total revenues from both their accessories and iTunes is over $5.5 billion, which is more than the total revenues of competitors such as Nokia and Motorola.  

Another reason Apple is so beneficial for the economy is because it creates numerous jobs. Jobs that are created can vary from being the ones who design and are the engineers of the newest technology, or the people who deliver the new products to your house. Apple creating jobs not only helps the economy but the people who work for Apple. Some of the jobs include working on the apps, retail, and customer support. Apple has also been setting trends since it initially came out with its first development. One of them being the iPhone, not too long after this Android would release their own phone similar to an iPhone. This is only one of many things that Apple has came out with and not shortly after there would be something that tried to imitate it. Apple is continuously coming out with the newest technology and being completely ahead of the game compared to others.  

 Apple is considered to be one of the most technologically advanced companies in the world. Not only does Apple benefit the United States, but other countries as well. Apple was invented and the inventors likely did not know and weren\'t aware of how well off their once small million dollar company would turn into a billion dollar company. Despite having hard times when the company wasn’t doing as well, the creators and workers worked hard to get the company back on track. Even when you consider all of the other companies out there to be a competition, Apple is still on top. Some facts say that Apple has been on the decline recently because there is no one new buying an iPhone. People who are against iPhones and can\'t bring themselves to buying one will never buy one unless they have a specific reason to. This meaning that Apple\'s sales haven\'t increased because the only people who are buying iPhones are the people who have already had an iPhone. If Apple didn’t exist or for some reason ended the economy would not be the same. Since Apple brings in so much money, the economy would likely decline or not be the same because of this.

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