Chapter 1.5 External Environment Flashcards
Business Cycle
Refers to the fluctuation in the level of business activity over time. Countries tend to move through the cycle of booms, recessions, slumps, recovery, and growth.
Deregulation
Is the removal of government rules and regulations which constrain an industry to enhance efficiency and encourage more competition within the industry.
Economic Growth
Measures changes in the Gross Domestic Product of a country over time. It occurs if there is an increase in GDP for two consecutive quarters
Ethics
Are the moral values and judgements (of what is right) that society believes businesses ought to consider in their decision-making.
The exchange rate
Is the value of a country’s currency in terms of other currencies
Inflation
Occurs when the general price level in an economy continuously rises. It is measured by changes in the cost of living for the average household in a country.
Interest rate
Is a measure of the price of money in terms of the amount of charged for borrowed funds or how much is offered on money that is saved.
Protectionist measures
Are any measure taken by a government to safeguard its its industries from overseas competitors. They are a threat to businesses trying to operate in foreign markets.
Protectionist measures
Are any measure taken by a government to safeguard its industries from overseas competitors. They are a threat to businesses trying to operate in foreign markets.
STEEPLE Analysis
Is an analytical framework used to examine the opportunities and threats of the external environment (social, technological, economic, environmental, political, legal, and ethical environments) on business activity.
Unemployment
Refers to the number of people in the workforce who are willing and able to work but cannot find employment.
