4.1.1 Growing Economies

Question 1

Implications of growing economies for individuals - 2

Answer 1

• greater level of output leads to increased employment opportunities.More ppl are now earning as their income increases. - move from poverty of Middle class
• As Standard of living increases may increase individuals for individuals too

Question 2

Importance of employment patterns/rate for businesses

Answer 2

• if employment rate is low then it’s not a good time to export products but a good time invest due to lack of jobs (e.g build a factory in that country) & vice versa

Question 3

Implications of Economic growth for businesses

Paper sheet

Answer 3

• Consumers now have increased income which means there may be an increased in demand for domestic businesses/foreign businesses products

(leading to increase revenue/therefore profits for businesses entering that emerging market)

Question 4

Another implication for Businesses expanding to emerging economies

• less competition

As a result

Answer 4

Maybe less competition in emerging economies compared to their domestic markets

• May benefit from first mover advantages e.g charging lower price/higher increases.

Question 5

Another implication for businesses to expanding to emerging economies

• Sales volume & EOS

Answer 5

Provides the opportunity to achieve EOS

Larger population means higher scale of production and more sales volume therefore can achieve EOS.

Question 6

Disadvantages of operating in an emerging market

Paper sheet

Answer 6

• Volatile e.g fluctuating exchange rates , may not be politically stable

Question 7

2 overall cons of emerging economies as a whole

Answer 7

1) infrastructure of developing countries may be poor

2) Setting up in overseas economies can be risky - maybe cultural risks & barriers e.g language & different tastes