2.3 The Economic Climate Of Business

Question 1

The economy

Answer 1

Made up of millions of individual consumers

Question 2

Overdraft

Answer 2

A flexible loan which businesses can use, whenever necessary, up to an agreed limit

Question 3

Economic climate

Answer 3

The state of key factors within a country such as the levels of goods and services produced

Question 4

Interest rates

Answer 4

The cost of borrowing money or the reward for saving money

Question 5

Consumer spending

Answer 5

The value of goods and services bought by consumers over a time period

Question 6

Income elastic products

Answer 6

Those whose sales are sensitive to changes in consumers’ incomes