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btec business level 3 unit 1 P5 and M2
This will help you achieve your P5 in unit 1
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P5 – Tesco in UK and ChinaTesco has becoming a major trader across the globe but with this faces many
challenges. Across the countries in which it operates in, each has their own laws,
regulations, economy and consumers. For this section of your assignment you
need to complete a case study on Tesco in the UK and Tesco in China.
1. Describe the following terms:
Economic cycle – Economic cycle is the natural fluctuation of the economy
between periods of expansion (growth) and contraction (recession). All countries
and all businesses experience regular ups and downs in the growth of output,
jobs, income and spending. These fluctuations form what is known as the
economic or business cycle.
Deficit – The amount by which a resource falls short of a mark, this is most often
used to describe a difference between cash inflows and outflows. Deficit is also
known as the gap between what the governments spends and what it gets in
income, mainly from taxes.
Economic growth – An increase in the capacity of an economy to produce
goods and services, compared from one period of time to another. For comparing
one country's economic growth to another, GDP should be used as these take
into account population differences between countries.
Inflation – Inflation is the rate at which increase in the general level prices for
goods and services. It is measured as an annual percentage increase. As inflation
rises, every dollar you own buys a smaller percentage of a good or service. The
banks try to limit inflation and ignore deflation, in order to keep the economy
running smoothly.
GDP – GDP stands for Gross domestic product and is the monetary value of all
the finishes good and services reduced within a country’s border in a time
period. This is calculated yearly. Put simply, GDP is a broad measurement of a
nation’s overall economic activity
Unemployment – Unemployment is when a person is not working and is looking
for a job however this might be hard to find a job and work. The unemployment
is often used to measure the economy’s health. The most frequently cited
measure of unemployment is the unemployment rate.
Competition – Competition is when every seller tries to get what the other
seller are selling in order to make a profit at the same time, this could be done
by offering the best price, quality and the best service. It is where the market
information flows freely. Competition is regulatory function in balancing demand
and supply.
, Government intervention – An economic intervention is an action taken by a
government or international institution in a market economy in an effort to
impact the economy beyond the basic regulation of fraud and enforcement of
contracts and provision of public goods.
2. For each country UK/China research the key statistics and figures and
enter in the table below:
Factor UK China
Phase of the 0.7% - mid expansion 7.4% - late expansion (recession)
economic cycle (growth)
Inflation rate 0.1% not growing up too 1.6% growing up rapidly
much
GDP 2941.89 billion 10360.10 billion Us dollars in
2014, because bigger county and
it is cheaper for paying labour.
Employment/ 5.4% Feb 2015 4.1% 2014
unemployment
rates
Competition 10 small or no number Large number of small firms - lots
within country and large firms of competitions but different type
competition is fierce
Government Market economy – Command economy – greater
control (who, minimal government government intervention
how) intervention
Economic 0.5% 7.4% in 2014
growth
3. For each of the following factors describe how Tesco is influenced by each
of the factors:
Economic cycle
In UK – In the united kingdom the phase of the economic cycle is about 0.7%,
which is a good figure because it is making the growth and it is also mid
expansion and this might influence the Tesco in UK because it is making
growth.
In China – In China is the phase of the economic cycle is 7.4%, which is not a
good figure because it is making late expansion and the smaller the
percentage the better and the lower the percentage the bad it is so in this
term the figure is bigger than UK so it will going on recession.
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