Created: Feb 5, 2018 | Updated: Apr 23, 2020. / The Major Economic Factors Affecting Business Drastically. Restaurant PESTLE Analysis. Government And Economic Influences On Business Activity . B. Quick revise. This resource contains a full lesson PowerPoint including a starter and plenary around the topic of Economic Influences. Economic analysis provides an insight into the essentials of an economy. The following are the main economic factors that greatly influence the consumer buying behavior: Personal Income: The personal income of an individual influences his buying behavior as it determines the level to which the amount is spent on the purchase of goods and services.The consumer has two types of personal incomes disposable income and discretionary income. For example, in the past 20 years, India has seen a shift from a conservative religious society to a more secular society with a greater focus on material improvement. As the economy goes through expansion and contraction, it’s condition changes over time. Positive economy condition can be favorable for business development and adverse ones may generate negative consequences such as narrow down business scale, capital shortage or even bankrupt. They have a lot of power over business activity and can pass laws to try to achieve their goals. Maintain a low level of unemployment; Achieve a high level of growth rate; Maintain a healthy balance of payments. Every country has a set of characteristics, such as natural resources and skilled manpower, that can influence their ability to build their economy. Economic Factors. The balance of payments . It’s a governance challenge that may result in long-term consequences for communities and businesses. Interest Rate is a major factor affects the liquidity of cash in the economy. This resource contains a the whole topic for External (Economic) Influences. External Influences, Economic: A Level Business (no rating) 0 customer reviews. A fall in sales and output for one business. On top of this, they also need to accommodate human behaviour. Start studying Chapter 9: External economic influences on business behaviour (A level 1.6). Understand how key economic factors such as inflation, unemployment, interest rates and consumer confidence affect the level of demand for consumer goods. The goal is to always make better decisions for the firm’s progress. It is related with taxes and government spending. Created: Mar 18, 2019 | Updated: Apr 23, 2020. View bio. Culture of entrepreneurship. Related. The political environment affects the economic environment of businesses. Social and economic variables, known as socioeconomic factors, intersect and influence quality of life. Some argue a Command economy can lead to economic stagnation, e.g. Economic factors that commonly affect businesses include consumer behaviour, employment factors, interest rates and banking and inflation and overall economic indicators. The primary influences on a business are: political, economical, social, technological, legal and environmental, which are often abbreviated to PESTLE. Share . Both international and domestic businesses are often affected by the dynamic economic conditions prevalent in the market. Preview. 1. Epidemics are both a standalone business risk and an amplifier of existing trends and vulnerabilities. Updated September 26, 2017 . They also include several legal regulations in the country, which are … AS & A2 LEVEL (A-Level) Revision; Business Studies (A-Level Revision) External Influences; Economic Opportunities & Constraints; Economic Opportunities & Constraints; Economic Influences. Government influences the economy through its economic policies. Geographical and Ecological or Natural Factors. PESTEL or PESTLE analysis, also known as PEST analysis, is a tool for business analysis of political, economic, social, and technological factors. Level Teaching Pack 5: Macroeconomics: Peter Hogan: 9781857494495: Books - Amazon.ca. Evaluation – other possible factors that influence economic development. The nature of business ownership has a significant impact on financial objectives. The main ways in which governments can influence business activity are called economic policies. Government Economic Policies. The economic environment consists of microeconomic and macroeconomic factors. Economic factors affecting business include all important trends in the economy that can help or hinder the company in achieving its objectives. 7. It is already a habit for managers to evaluate each of these factors closely. China has successfully … C. Changes in gross national product D. 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