The economic factor depends on outside control of the business, but it can affect the performance and marketing of the organisation. The main factors which mainly influence the economic balance of an organisation are political, economic, social technological, environmental and legislative factors. On an international front economic aspect is an essential interference in the performance of Tesco. Apart from the political stability of the region, factors also involve acts of legislation and tax rates. It is a major point of concern for the organisation, therefore it is essential to be aware of the changes in the policies.
It began with the world economic crisis in 1929 that affected the American nation the most. The crisis of overproduction of goods provoked the Great Depression. At that time, commodities/goods/items could not be bought because of the limitation of money supply - dollars were tied to the gold reserve. The end of the First World War played an important role in boosting the severe economic crisis. The fact was that the U.S. economy was heavily dependent on defense orders, and, after the end of the war, their number decreased, which led to a recession in the American military-industrial complex.
Nowadays, the free market economy has been involved in almost every country. They wither have a portion of the economy being free market or the hwol thing being free market. In the free market system as there is no government interference, there will be no government grants, loans, subsidies etc. The government wouldn’t have no control over firms from the forces of the market pressure, or even enforce policies of taxes, contracts between business, land ownership rights etc. In the free
The Economic factors are determinants of an economy’s performance that directly impacts a company. These factors include inflation rates, interest rates, exchange rates and economic growth. These affect how businesses operate and make decisions. The economic climate in the country is of major concern to every company as it has impacts on the business and consumer spending. For example, the exchange rates can affect the costs of the supply and price of imported goods and exporting goods in an economy.
This is primarily a tool at the disposal of the central bank of a country which uses different tools to manage the macro economic variables of a country to keep the economy stable or to stabilize it in situations of fluctuations. Monetary policy can be expansionary or contractionary depending on whether the money supply is being increased or decreased in the system so as to affect economic growth, inflation, exchange rates with other currencies and
4.0 Implementation 4.1 Broader perspective Globalization is affected by various factors that drive towards its existence and formation in the society and a set of these macroeconomic factors. As per this analysis we can get an overview of the current economy of the country that helps the researcher to make relevant suggestions and recommendations that can benefit the economy as well as society to make them believe and trust that the globalization enhances their behaviour and life style. PEST Analysis: Source: Visual.ly website PEST Analysis of Saudi Arabia Political environment Giddens and Griffiths (2006, p. 59) states that mainly there are three reasons why politics has become one of the main drivers of globalization.
Countries that are developed like the US are richer and they have programs to help the less fortunate to lessen the amount of people in poverty. Income in developed countries determines the standard of living. 9. Why do prices rise when the government prints too much money? The price will raise when a government prints too much money, because the money loses some its value.
Monetary policy is enacted by a central bank that controls money supply that is circulating in the economy. This money supply influences inflation and interest rates that determine consumption level, employment rate and cost of debt. Expansionary monetary policy involves in buying treasury notes and declining interest rates on loans of central banks. These actions help in making the money supply to increase and making interest rates lower. This policy also makes consumption to be more attractive corresponding to savings.
All the units of a product are similar and there are no alternative to that commodity in the firm. The firm are controlling over the market by offering a product that is not same with other. The firm may use specialized information like trademark and copyright in order to establish legal authority over the production of some goods and services. Normally, monopoly situation in a market can continue only when other company does not enter into the industry. In a monopoly market, they have no others competitor because barriers of enter are very strong.
An economics field of study that applies both macroeconomic and microeconomic principles to international trade, which is the flow of trade among nations, and to international finance, which is the means of making payment for the exchange of goods among nations. International economics studies the economic interactions among the different nations that make up the global economy. Often this interaction is viewed in terms of the domestic economy and the foreign sector. The key economic principle underlying international economics is the law of comparative advantage. International economics is growing in importance as a field of study because of the rapid integration of international economic markets.