Unit 13: Influences On Business Activity

Question 0

What is a grant and a subsidy and what are their purposes?

Answer 0

• a grant is money given by the government to a business without repayment. It can be for exporting, investment in machinery, or to encourage relocation.
• a subsidy is money provided for firms over a long term, to prevent declines and job losses.

Question 1

How can the government intervene in location decisions of citizens or businesses?

Answer 1

They form planning regulations of:

• where different types of buildings and businesses can be located
• the size and acceptable structure of these buildings
• what types of building fit in with the local environment

Question 2

What is a trade union?

Answer 2

A trade union is an association of employees, set up to protect their interests.

Question 3

What are the trade unions aims?

Answer 3

• better working conditions
• health and safety
• better pay
• training
• equal opportunities
• influence over decisions at work
• benefits for members
• shorter working hours

Question 4

What is the representative of the union called?

Answer 4

Union officials

Question 5

How do employers and employees come to an agreement?

Answer 5

They negotiate. Negotiations can take place at a local level or a national level - where the union represents all the members of the trade union in the country.

Question 6

What can be the benefits of belonging to a trade union?

Answer 6

• knowing that you are not alone
• belonging to a body that is negotiating better term and conditions
• direct benefits for employees
• ability to have direct actions to support members
• being able to go on strike as a union

Question 7

What are business ethics?

Answer 7

Business ethics are the values and principles that operate in the world of business. However ethical activities do not mean legal, there can be legal activities that are not ethical.

Question 8

What makes an ethical business?

Answer 8

The ethical business

• gives fair wages
• looks after the welfare of employees
• minimizes waste
• provides excellent products and services for consumers
• does good work in the community
• respects the environment

Question 9

What does CSR stand for and what is it?

Answer 9

Corporate social responsibility is a firm that describes the way in which an ethical business contributes to society.

Question 10

Give examples of social responsibilities?

Answer 10

• Making sure that your business does not use child labour or buy form suppliers that use child labour
• providing fair wages for employees
• having fair trade (giving a fair price for suppliers)
• minimizing waste and eliminating or reducing pollution

Question 11

What are the health requirements at work?

Answer 11

• protecting workers from dangerous machinery e.g providing shields on cutting equipment
• requirements to wear safety equipment and clothing e.g making workers wear helmets
• hygienic conditions for employees to work in e.g make employees undertake medical screening to avoid infections
• number of hours worked e.g by setting maximum hours worked a year aprox 35 -45 hours a week.

Question 12

What does ILO stand for? What do they create and explain them?

Answer 12

International Labour Organisation create conventions and recommendations that meet international labour standards.

• conventions are like international treaties drawn up by a number of governments. If a government sign up to a convention, they are expected to follow the requirements.
• recommendations are guidelines for action by member states of ILO.

Question 13

How are recommendations and conventions used?

Answer 13

• used by businesses to guide the standards that create for employees
• used by government to create health and safety laws
• used to trade unions to support their arguments in negotiations about working conditions

Question 14

What is employment legislation?

Answer 14

They are laws with the intention to protect employees in the workplace.

Question 15

What is a contract of employment?

Answer 15

A contract of employment sets out the relationships between the employer and employee to deliver goods and services and to do something on jointly agreed terms.

Question 16

What do employment legislation do?

Answer 16

• Protects of employees against discrimination (treating one person or group less favourably than others may be due to gender, race, religion…), and unfair dismissal.
• However legislation may exist but not enforced.

Question 17

How are the standards to protect consumers created?

Answer 17

• Created by law at international, national and local levels
• Set out in voluntary codes by groups of businesses working together to create standards
• Creates by individual businesses who set their own standards

Question 18

What does protection when buying goods cover?

Answer 18

• How goods are sold: Goods should be fit for the purpose and fit for description (especially goods sold in packets).
• Dangerous products: Consumers have to be protected from harmful protects e.g children toys should not have any sharp edges.
• Buying a service: A service should be carried out with reasonable care and skill with reasonable time and reasonable charge.

Question 19

What do businesses need to look at when carrying out a decision? (haha yes not a specific question but still)

Answer 19

Financial costs and benefits, which are monetary calculations of the effect of a business project.

Question 20

What are the ways in which the exchange rate may influence business activities?

Answer 20

• It may effect the price of goods and services that business buy in international markets.
• It may affect the price at which business sell goods and services in international.

Question 21

What is the business/trade cycle like?

Answer 21

The economy grows and then starts to fall up and down, up and down.

Question 22

How are the up and down falls described formally?

Answer 22

• Recession describes a period in which national income (the total value of goods produced in the economy) falls for at least half a year. However when it lasts for 3 years or more it is a SLUMP.
• Recovery describes a period in which national income rises after a recession or a slump. It usually lasts for 6 months and if it lasts longer it becomes a boom.

Question 23

What happen in booms and slumps?

Answer 23

• Boom: Output of goods rises, firms take on more employees, wages and prices rise.
• Slump: Output falls, firms lay off workers, wages and prices fall.

Question 24

How does a boom turn into recession?

Answer 24

As the boom reaches its peak, costs are likely to rise. At the top of the boom, it will become more difficult to recruit labour, and wages and other costs will rise. Businesses will start to make cutbacks such as reducing size of labour or investing less in new machinery.