Unit 38 - Business and the Economic Environment P2
P2 Identify how government policies impact on a selected business
Case Study: Jaguar Land Rover
BTEC Level 3 Extended Diploma in Business
Understand the impact on businesses of changes in the economic environment
Abdulalah Al-Jobore
Unit 38 - Business and the economic environment
P2
P2 Identify how government policies impact on a selected business
In this assingment, I will be producing a thorough investigation using the extensive research
conducted by me, and demonstrating that I have gained a good understanding of how government
policies impact on businessess. I will be making particular reference to how government policies
impact on Jaguar Land Rover.
Government policy
In the UK, every five years there will be an election for new government that has to be held and
people will be able to vote for new government to run the country. Therefore, the new government
will be able to produce a set of policies to influence and develops the economy of UK. The term
‘government policy’ is used to describe any course of action which aims to change a certain situation
in order to make a real life change that helps UK to become better country. The government uses
these policies to deal with a wide range of issues within the country. It have the authority to make
policies that could affect and change how much tax people have to pay, parking fines, immigration
laws and pension. The government policies are divided into nine key area that influences the way
the businesses operates:
Economic policy
Economic policy refers to the policies that the government uses to influence or to control the
behaviour of the economy such as economic growth, inflation and unemployment. The government
typically implemented and administered these policies as it put together a package of measures in
order to deal with these issues. Although the government might aims to put a solution for one
issues, however sometimes the objective of each policy can conflict with other objectives.
One of the economic policies that could affect Jaguar Land Rover is the Economic growth and
unemployment policies as they are interlinked. The government do considers economic growth as
one of their important consideration, as it is directly related to the increase in the living standards of
the UK citizens. Having a steadily economic growth rate, is very important as it means people having
a good standard of living. This therefore means that individuals are bringing in an income, the
demand of products and goods and service are increased, higher revenue from taxes to fund public
service and low rates of unemployment leading to less poverty. When the government uses
unemployment policies to grow the economy of the country, then people will be employed and
earning money, Jaguar Land Rover will have more suitable people to work with them and increase
their production. However, this might have a conflict with other objective even though it might
benefit them in somehow. This is because when employment rates are increasing, then the
government will have to increase taxes to fund public services and benefits payments. This means
Jaguar Land Rover will have to pay more money through taxation. Furthermore, the economic
growth is not necessarily have to leads to reduce the level of unemployment, since it depends on the
type of growth of economic and the type of jobs. The economic growth and unemployment policies
is interlinked with other policies such as those on education, skills and training.
Industrial policy
Industrial policy is refers to the government’s strategic effort to encourage and enhances the
development and growth of the industry sectors in the economy. It identifies any type of selective
intervention or the UK government policy, which intends to changes the structure of production
towards sectors that government, believes to offer better prospects for economic growths. In 2009,
when the UK economy was facing an increase in deficit and the size of production/industry sector
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