Ziad Chaar

Tuesday, October 6, 2020

B&M tasks

Task 1:
- Social
- Technological
- Economic
- Environmental
- Political
- Ethical
- Legal
- External
- Threats
- Intuition

Task 2:
a. Threat: has a higher exchange rate ‘‘appreciation’’ this means that export
prices will be relatively higher, leading to a reduction in the exporters prices
competitiveness.
Opportunity: when a lower exchange rate ‘‘depreciation’’ gives domestic
companies a relative price advantage, although they have to pay higher prices
for imported raw materials.

b. Inflation refers to the devaluation of the currency of the country and the
increase in prices. Although, locals cannot afford paying the high prices,
governments control the inflations, and this makes households and firms spend
money at a faster rate as income levels also increase because of increased
wages.

c. The opportunity of the minimum wage is to increase workers productivity,

reduces turnover, and absenteeism, therefore, boosting the business. The threat
can be caused by high production costs which make employers may be reduce
the number of employees.
d. this happens because these businesses operate in a local, and global market
that is affected by external factors such as global pandemics, recessions, and
natural disaster.

Task 3:
a.
Example External Example External
factor factor
Ageing population Social Tariffs and quotas Political
Average family size Social Consumer protection Legal
changes rights
Consumer confidence Economic Oil price changes Economic
levels
E-commerce Technologica Scientific development Technological
developments l
Employment laws Legal Interest rates changes Economic
Exchange rate Economic Moral business behavior Ethics
fluctuations
Fiscal and monetary Political Natural disasters Environmenta
policies l

b.
Type of external Example
influence
Environmental Consumers go ‘green’ and recycle in order to conserve
the planet.
Political Decision to spend more money on education and public
health care services.
 Social Increasing number of older and retired people in the
country.
Economic Interest rate hikes dampen purchase of private and
commercial property.
Technological More businesses devote money to developing their e-
commerce strategies.
Legal Smoking bans in restaurants, shopping malls and public
parks.
Ethical Businesses choose to adopt environmental practice and to
meet their corporate social responsibilities.

Task 4:
a. T
b. T
c. F
d. F
e. T
f. F
g. T
h. T
i. T
j. T

Task 5:
a. Tariff
b. Recession
c. Protectionism
d. Monetary policy
e. Interest rate
f. Inflation
g. Indirect tax
h. Economic growth
i. Direct tax
j. Business cycle

Task 6:
a. an increase in the interest rate leads to an increase in the rate of repayment
which then reduces the revenue of the business and the purchasing power of
people declines, therefore, decreasing the rate of the inflation.
b. a high exchange rate makes the price of exported good less which means
decreased revenue for the country through exports. However, it makes the price
of imported goods cheaper leading to an increase in imports. This way the
country loses more money through imports than it gains from exports.

c. The positive correlation means if the interest rate increases so will the change
in the exchange rate and vice versa. This means people keeping their money in
banks will get higher interests for their savings. This leads automatically to an
increase in the exchange rate.

d. Inflation makes countries less competitive because the country will charge
high prices for all goods and services for the locals and the foreigners making
them more expensive for the customers to afford.

e. an increase in income tax rates means taking more money from people and
leaving them with less money to spent in the country. This would decrease the
level of inflation.

f.
- i. Boom
- ii. Recession
- iii. Trough
- iv. Recovery
- vi. Growth

Task 7:
1. A
2. C
3. A
4. B
5. C
6. A
7. D
8. D
9. A
10. B
11. C
12. D
13. C
14. D
15. A
16. B
17. D
18. B
19. B
20. B
21. B
22. D
23. C
24. C
25. C
26. D
27. D
28. D
29. A
30. C