Influences On Business

Question 1

Advantages and disadvantages of behaving ethically

Answer 1

Advantages:
- improved brand awareness and reputation
- higher revenue as it creates a competitive advantage

Disadvantages:
- higher costs
- lower sales if prices rise as costs increase

Question 2

The economic climate

Answer 2

Definition: Refers to how well the country is doing in terms of the levels of income and employment.

As a result…
- sales can decrease
- costs may have to be cut
- redundancies may have to be made

Question 3

Globalisation

Answer 3

Definition: how businesses in different countries become increasingly connected to their activities. Moving production abroad, selling abroad.

Question 4

Advantages and disadvantages of multinationals

Answer 4

Advantages:
- increased sales as market size bigger
- access to cheaper labour and raw materials

Advantages to host country:
- creates jobs
- may create better infrastructure

Disadvantages to host country:
- local businesses may close due to competition
- environment damaged due to production