External Influences Flashcards
What is the business cycle and how is it measured?
The business cycle shows changes in economic activity over time, measured by gross domestic product (GDP).
What are the characteristics of a boom cycle?
A boom cycle has low unemployment, strong economic growth, rising inflation, and high consumer confidence, boosting spending and business profits.
What happens during a recessionary cycle?
A recession has rising unemployment, slow economic growth, and falling inflation. Consumer spending and confidence drop, leading to cost-cutting and job losses.
What is deregulation in financial markets?
Deregulation means removing rules to boost efficiency and competition, like floating the dollar in 1983 and lifting foreign bank limits in 1985.
What is an interest rate, and how does it impact businesses?
The interest rate is the cost of borrowing and the reward for saving, affecting business loans and consumer spending.
What are exchange rates, and how do they affect businesses?
Exchange rates compare the value of currencies, affecting competitiveness. Appreciation makes exports pricier and imports cheaper, while depreciation has the opposite effect.
How does globalisation impact businesses?
Globalization boosts competition, expands markets, raises customer expectations, lowers material costs, and provides access to labor and economies of scale.
What are geographical influences on business?
Geographical influences include demographics (age, sex, gender, religion) in a region, which affects the demand for goods and services.
How do societal attitudes influence businesses?
Societal attitudes, like values and beliefs, affect consumer behavior, work, and product demand. Ignoring these changes can harm a business.
What are three main social issues influencing business practices?
Environmental concerns, family-friendly workplaces, and diversity and ethical employment practices.
What is the Fair Work Act (2009), and how does it affect businesses?
The Fair Work Act regulates worker-employer relations, setting standards for contracts, conditions, and dismissal, including the National Employment Standards.
What is the Work Health and Safety Act (2011)?
The Work Health and Safety Act regulates workplace safety, training, risk reduction, and safe product handling, enforced by agencies like SafeWork NSW.
What is the Competition and Consumer Act (2010)?
The Competition and Consumer Act enforces Australian consumer laws, managed by the ACCC.
What are some recent free trade agreements negotiated by Australia?
Free trade agreements include those with India (2022), the UK (2023), and Indonesia (2020).
What is the role of local government in business?
Local governments approve development applications, enforce fire regulations, parking rules, and set business sign regulations.
How do government policies impact businesses?
Government policies, especially tax changes and trade policies, affect businesses, particularly in areas like taxation, trade, and commercial regulations.
What is the role of the federal government in business?
The federal government handles employee and business taxes, provides superannuation, and enforces customs regulations.
What obligations do state governments have for businesses?
State governments ensure worker entitlements, like workers’ compensation, and enforce regulations such as payroll taxes and pollution controls.
How does technology influence business operations?
Technology helps businesses achieve goals like quality, cost, and speed, but can also cause job losses, while creating new jobs.
What is the impact of competition on businesses?
Competition drives businesses to improve efficiency, gives consumers more choices, and keeps prices low. To succeed, a business must maintain a competitive advantage.
What are the four types of market concentration?
Perfect competition, monopolistic competition, oligopoly, and monopoly.
What are the characteristics of a monopoly market structure?
A monopoly market is controlled by one firm, which sets prices due to no competition, making it hard for new competitors to enter.
How have financial markets been affected by deregulation?
Financial markets are more open, offering greater access to overseas markets but also exposing businesses to financial crises.
What is the impact of labor markets on business?
hiring, wages, productivity, and overall economic performance
How have consumer markets been impacted by technology?
Consumer markets have expanded with advances in technology and communication, giving businesses more opportunities to reach consumers.
