The term economic meltdown is the going down of the rate of economic activity of a country, in the simplest term, economic meltdown, could be called economic “Go-slow” just like traffic jam which grind.
The first and foremost action that an organization must take is to cut cost, this is because during these tough times, we all must make the utmost effort to save money, take care of expenses such as electricity stationery unnecessary wastage of resources in factories, office and other work places. One would of course face a lot of problem but there are solutions.
Again instead of sacking employees, a pay cut of say 11-16% for the employees is a more acceptable solution than carrying off people. The government is required to take action by cutting down taxes so that people will have more money to spend and therefore the economy can come back to track.
2.What are likely the causes and effect of economic meltdown on cost of production in an organization.
The likely causes of economic meltdown in cost of production in an organization are:
a.The culture of the people within the immediate vicinity as it affects the employees, belief systems, byelaws and traditions.
b.The organizational market-share and protection, its financial capabilities, resources availability, credibility and goodwill
c.The nations economic position, competition from internal and international organizations, supplies of production equipment and materials.
d.High rate of importation: this has been a great menace to the production of a company as many commodities are imported and on the long run other economies benefits
e.Inflation: The effect of inflation is not distributed evenly in the economy and as a consequence there are short fall of money and goods. The supply of money is a major, but not the only cause of inflation, organization for economic cooperation and development. However, frequent...