Business Environment P5

Topics: Economics, Inflation, Money Pages: 2 (618 words) Published: June 22, 2013
How businesses are influence by the economic environment

The business environment consists of different influences that are outside of a business from political, social and legal changes. These influences can change for the better or for the worst for the business economic factors.

The economic environment consist of many individuals who make decisions that buy and sell goods, borrow and lend money, raises taxes and change interest rates. Consumers are who purchases the goods for their own personal interests, suppliers who supplies goods to other businesses and customers, bankers and other lenders who lends money to businesses and to individuals who are qualified for a loan, the government who set taxes and also decides how much money and different parts of government should be spending, and the monetary policy committee who decides on the levels of interest rates in the country. When in business one must consider the importance of stability, business people would rather a stable economy. This is when business people can make forecasts for short term and long term demands for their business when purchasing or selling products for the near future. Forecast is predicting a positive outcome or maybe a negative outcome for what type of position your business is in now or purchasing decisions for the future, a business looks at what type of financial state it is in right now to make company decisions one must ensure that they can repay payments or purchase items while ensuring that there business is in the right financial position.

The impact changes in the economic environment.

Growth in the economy is when the economy is at a stable point where businesses are doing well when more goods are being produced and consumed, many jobs available, work available and opportunities to invest in companies, companies are doing well high purchasing power for business owners and suppliers, more goods and services sold and the value of goods may increase, and this has...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Business Environment Essay
  • Business Environment Essay
  • the business environment Essay
  • Essay about business environment
  • Business Environment Essay
  • business environment Essay
  • The Business Environment Business 100 Essay
  • Business Environment Essay

Become a StudyMode Member

Sign Up - It's Free