Professional Documents
Culture Documents
The internal factors basically include the inner strengths and weaknesses.
Internal factors can affect how a company meets its objectives. Strengths
have a favorable impact on a business. Weaknesses have a harmful effect
on the firm. Below, I have mentioned the most common internal factors.
Organizational and operational
These are a part of the operational and administrative procedures. This
includes disorganized or inaccurate recordkeeping. Interruptions to your
supply chain and outdated or faulty IT systems are also factors you should
evaluate .If you do not overcome these, your customers might see you as
unreliable. You can also lose all your data.
Innovation
Your business needs innovation in order to keep up with competitors. It is
essential to get one step ahead. Innovation could come in the form of
marketing. It could also be through promotional initiatives in the marketing
plan, staff training, and welfare. Embracing new technology is the best way
to keep up with technological advancements. A lack of innovation can pose a
serious risk to a growing business. No innovation will cause a company to
remain boring. The company will become dull, stagnant and irrelevant
They run short of funds for both short term and long term needs. At
times, the funds provided by financial enterprises are not enough.
This results in these industries having depend on private financiers
who offer the sum for a hefty interest rate. As a remedial measure,
an integrated credit system can be established through they can be
given enough finance to meet both short and long term
requirements. The interest rate for these funds should also be such
that it can be borne by the industry.
Q4 Define privatization.
The transfer of ownership, property or business from the government to the private sector is termed privatization.
The government ceases to be the owner of the entity or business.
The process in which a publicly-traded company is taken over by a few people is also called privatization. The
stock of the company is no longer traded in the stock market and the general public is barred from holding stake
in such a company. The company gives up the name 'limited' and starts using 'private limited' in its last name..
Fiscal policy is the means by which a government adjusts its spending levels and tax rates to
monitor and influence a nation's economy. It is the sister strategy to monetary policy through
which a central bank influences a nation's money supply. These two policies are used in various
combinations to direct a country's economic goals. Here's a look at how fiscal policy works, how
it must be monitored, and how its implementation may affect different people in an economy.
Many businesses are using technology to stay competitive, they create new
products and services using technology, and they also use technology to
deliver those products and services to their customers on time. A good
example is, mobile phones companies like Apple& Samsung, these two
electronics companies, use high end technology to create new smartphones
and other electronic devices to stay competitive. This competitive edge is
gained through employing advanced technology.
An s :Monetary Policy:-
Monetary policy is the term used by economists to describe ways of
managing the supply of money in an economy. Monetary policy is the
process by which the monetary authority of a country controls the
supply of money, o f t e n t a r g e t i n g a r a t e o f
interest f o r t h e p u r p o s e o f promoting economic g ro w t h
a n d s t a b i l i t y. T h e o ffi c i a l g o a l s u s u a l l y i n cl u d e re l a t i v e l y
s ta b l e p r i c e s a n d l o w unemployment. Monetary economics
provide sin sight into how to craft optimal monetary policy.
Monetary policy is referred to as either being expansionary or
contractionary, where an expansionary policy increases the total
supply of money in the economy more rapidly than usual, and
contractionary policy expands the money supply more slowly than
usual or even shrinks it. Expansionary policy is traditionally used to try
to combat unemployment i n a recession by lowering interest rates in
the hope that easy credit will entice businesses into expanding.
Contractionary policy is intended to slow inflation in order to avoid the
resulting distortions and deterioration of asset values.
Effect on business:-
The eff ect of an expansionary monetary policy is to lower
the exchange rate, weaken the fi nancial account and
strengthen the current account. A restrictive monetary policy
would be expected to result in the opposite: a higher exchange rate,
a stronger financial account and a weaker current account (a
more negative, or a less positive balance of trade).With a program
of expansionary (easy) monetary policy, the following sequence of
events would be expected to occur with regard to
t h e i n c o m e e ff e c t :
· The domestic GDP will rise.
. T h e r i s e i n d o m e s t i c G D P w i l l t e n d t o i n c re a s e t h e
demand for imports. T h e i n c re a s e i n i m p o r t s w i l l
cause the current account to deteriorate.
· The increase in imports purchased will increase the need to
convert domestic to foreign currency. As a result, the
exchange rate of the domestic currency will decrease.
·With no government intervention, the financial account must now
move toward a surplus as the financial and current account must
sum to zero. Due to the increase in imports, foreigners will now have
a surplus of the nation's currency. If foreigners do not use that
currency to purchase the country's exports (which would improve
the current account balance), they will ultimately need to invest
that currency in the a s s e t s o f t h e d o m e s t i c c o u n t r y.
T h i s e x p l a i n s w h y c o u n t r i e s s u c h as China and Japan
invest large sums in assets such as U.S. Treasuries. The holders of
the U.S. currency must put it to work somewhere! Note that foreign
investors are often getting better rates of return than what might
be readily apparent because the value of the domestic currency is
falling relative to their own currency.