Interview
IGCSE Business Notes
- Course
- Institution
- Book
Notes covering chapter 27 to 29 from "Cambridge IGCSE and O Level Business Studies 5th Edition"
[Show more]
Connected book
Book Title:
Author(s):
- Edition:
- ISBN:
- Edition:
More summaries for
-
Grade 11 marketing (chapter 11)
-
Business Studies IGCSE/O Level - Full course summary
-
all answers to exam style questions of business book igcse
Seller
Follow
vikistanimir
Content preview
Chapter 27 – Economic IssuesGDP (Gross Domestic Product): total value of output of goods and services in a country in one year.
Trade Cycle Diagram:
- Growth: GDP rising, unemployment falling
- Boom: too much spending, prices rising and
shortage of skilled workers
- Recession: GDP falls
- Slump: series, long drawn-out recession,
unemployment is very high
Change in economic indicators:
- Employment: affects ability to recruit and the incomes of customers
- Rising inflation: business costs increasing
- Increase GDP: means economy growth, more sales due to more income.
Inflation: increase in average price level of goods over time
Unemployment: people willing/able to work cannot find a job
Government objectives:
- Low inflation: rapid inflation causes real incomes to fall, and prices will rise
- Low unemployment: unemployment causes less goods being produced, and unemployment
benefit from government
- Economic growth: GDP increases, more goods produced than previous year. Falling GDP
means more unemployment and lower standard of living.
- Balance of payments: difference between country’s exports and imports, matters for a
country with a soft currency
Exports: goods/services sold by one country to people/businesses in another,
this brings money into the country.
Imports: goods bought in from other countries, must be purchased with foreign
currency so money flows out of country.
Exports – Imports
Deficit means could run out of foreign currencies so they may need to borrow,
and exchange rate depreciation so currency will buy less abroad
Government influence economy:
- Fiscal policy (taxes and government spending): any change by the government in tax rates or
public sector spending. Governments spend money on school, hospital, roads, etc; especially
when wanting to encourage growth.
Income tax: tax on people’s incomes, usually, the higher the income, the more
the tax. Affect businesses (mainly luxury) due to a lower disposable income.
Profits tax(corporation): tax on profits made by businesses. Increase causes: less
profit after tax so less to reinvest.
Indirect tax (VAT – Value Added Tax): add to prices of products, more expensive
Import taxes:
Tariff: tax on imports
Quota: limit on quantity of imports
- Monetary policy: change in interest rates, cost of borrowing money, by government or
central bank.
High interest means:
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through EFT, credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying this summary from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller vikistanimir. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy this summary for R80,46. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
64438 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy summaries for 14 years now