Economic Environment

P5

Describe the influence of two contrasting milieus on line of reasoning activities within a selected organisation





Introduction

What are the stinting environment and the business cycle?

Those Economic factors which have their affect on the working of the business are known as economic environment. It includes system, policies and nature of an economy, trade cycles, economic resources, level of income, distribution of income and wealth. It does not remain the same. It keeps on changing from time to time with the changes in an economy like change in Government policies or the political situation.

Business Cycle



ripening

Growth and recession allow for be the result from the GDP (Gross house servant Product) increasing or decreasing, this mingys that the good or services are produced privileged the nations borders.
Growth is when the in that respect is an increase in the Gross domestic help Product from one year to another.
Recession is the opposite of Growth; this is when there is a decrease in the Gross Domestic Product.
If the GDP was to increase this would mean value that more goods and services would be produced and if there was a decrease in the GDP there would be less products and services being produced.



The Current addition rate in the UK is -0.



2
The Ripple Effect means that the more people that are being employed exit mean that they have more money to secure goods and services; this pull up stakes mean that there entrust be an increase in demand in them. This volition lead to producers and providers making and marketing more products, they will have ton hire more employees in order to do this and also have to buy more machinery to make the products. This will mean them investing more money.



Recession

This is when the value of goods and services in the economy will drop for two quarters in a row. This will mean that the people spending money on the products will have to cut back on spending, this will mean that they will then be saving more money, this will...If you hope to get a full essay, order it on our website: Orderessay



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