Topic 2.3 The Economic Climate Of Business

Question 1

Define the “economy”

Answer 1

The economy is made up of millions of individuals, consumers, many thousands of businesses and governments. All take decisions on what to buy and produce.

Question 2

Define “consumers”

Answer 2

Individuals who buy goods and services from businesses.

Question 3

Define the “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

Define “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

Define an “overdraft”

Answer 5

A flexible loan which business can use, whenever necessary, up to an agreed limit.

Question 6

Define “consumee spending”

Answer 6

Consumer spending refers to the value of goods ans seevices bought by consumers over a period of time, usually a month or year.

Question 7

Define “income elastic products”

Answer 7

Those whose sales are sensitive to change in consumer incomes.

Question 8

Define “SPICED”

Answer 8

strong pound imports cheap exports dearer.

Question 9

define “WPIDEC”

Answer 9

weak pound imports dearer exports cheaper