Chapter Name: Analyse the factors that influence economic activity
Description:This chapter covers various elements that impact economic activities and business operations.
Purpuse:To identify and assess factors influencing economic environments.
Rational:Awareness of these factors enables businesses to anticipate and respond to changes.
Chapters Topics
The effects of cyclical movements in a market system are evaluated in context of a new venture.
Discuss how business cycles (booms, recessions) impact sales, demand, and strategy for a new business.
A description is given of the concept of inflation and its impact on the new venture.
Define inflation and explain how rising costs and reduced purchasing power affect business pricing, inputs, and planning.
Reasons are identified for the decline in the value of money.
List and explain causes of currency devaluation, including inflation, foreign exchange rates, and economic instability.
An explanation is given for the role of foreign currency and exchange rates in the general economy.
Discuss how foreign exchange affects import/export businesses, and the implications for a venture sourcing goods/services internationally.
An explanation is given of the role of the interest/BA rate, Gross Domestic Product and Balance of Payments in the operations of the new venture.
Describe key economic indicators (interest rate, GDP, BOP) and their impact on borrowing, growth potential, and international trade in relation to a small business.