3.2.3- the economic climate on businesses

Question 1

the economy

Answer 1

the economy is made up of millions of individual consumers, many thousands of businesses and governments, all take decisions on what to buy and produce

Question 2

consumers

Answer 2

consumers are individuals who buy goods and services from the business

Question 3

economic climate

Answer 3

the economic climate describes the state of key factors within a country such as the level of goods and services produced and the number of jobs available

Question 4

interest rates

Answer 4

interest rates refer to the cost of borrowing money or the reward for saving money, expressed as a percentage

Question 5

overdraft

Answer 5

an overdraft is a flexible loan which businesses can use, whenever necessary, up to an agreed limit

Question 6

consumer spending

Answer 6

consumer spending refers to the value of goods and services bought by consumers over a time period, usually a month or a year

Question 7

income elastic products

Answer 7

income elastic products are those whose sales are sensitive to changes in consumers’ incomes