Unit 7 - Mrs Pope

Question 1

What is business legislation

Answer 1

Set of does and regulations with which a business has to comply

Question 2

What is the CMA

Answer 2

Competition Market authority - responsible for making sure all businesses abide the competition laws and investigate breaches of them

Question 3

3 competition laws the UK prohibit

Answer 3

• anti competitive agreements (price fixing)
• abuse of dominant market position (more than 40% of market is illegal)
• mergers that result in dominant position (e.g. Tesco and Sainsbury’s merging is illegal)

Question 4

Benefits of competition laws

Answer 4

• easier to compete on a level playing field
• customers have more choice

Question 5

Issues if a firm doesn’t comply to competiton laws

Answer 5

• reputational damage
• financial penalties (10% of turnover)
• criminal convictions

Question 6

Examples of labour laws

Answer 6

• working time directive ( cannot be made to work more than 48 hours a week, right to 20 min break, u18 can’t work 40 hours a week)
• equality act 2010 (protects people from discrimination)

Question 7

Impacts of labour laws

Answer 7

-additional costs so lower profit margins
+ improves employee employer relations
+ improves motivation
+ positive reputation
+ more efficient

Question 8

What are environmental laws

Answer 8

Legislation designed to influence the behaviour of individuals and businesses in order to reduce the negative impact on the natural environment

Question 9

Examples of environmental laws

Answer 9

• environmental protection act 1974 = controls waste management and emissions
• energy act 2011 = energy providers contain energy efficiency requirements

Question 10

Impacts of environmental laws

Answer 10

-fines
-additional costs
+ positive reputation
+ ethical
+ innovation
+ more efficent

Question 11

What is a free market

Answer 11

An economy or sector of an economy where the government intervention is minimal and where the market forces of demand and supply are expected to maximise business efficiency and customer satisfaction

Question 12

What is enterprise

Answer 12

The process by which new businesses are formed and new goods and services created and brought to the market

Question 13

Why does the government encourage enterprise

Answer 13

• Tax revenue
• economic growth
• job creation
• increase competitive pressure so existing businesses increase efficiency to compete which creates lower prices and greater choice for customer

Question 14

Government financial support

Answer 14

• grants
• reducing tax and national insurance
• start up loans

Question 15

Government non financial support

Answer 15

• simplified paperwork and planning
• training
• teaching enterprise in schools

Question 16

What are regulators

Answer 16

A person or governing body that sets policies for how businesses operate within their jurisdiction which enforces safety laws and protect customers from malicious business practices

Question 17

Roles of regulators (3)

Answer 17

• encourages competition by removing barriers to entry
• maintains high standards of customer service
• monitors and regulates prices

Question 18

What is infrastructure

Answer 18

Organisational struggles (buildings, transport, power, water, sewage, energy, communications) needed for a country’s economic development and prosperity

Question 19

What is the national infrastructure strategy

Answer 19

Sets to transform the UK infrastructure in order to level up the country, strengthen union and achieve net zero emissions

Question 20

The governments role in infrastructure

Answer 20

• provides funding (from taxes)
• direct investment and support to create jobs
• development of the infrastructure to achieve global trade

Question 21

What is a trade agreement

Answer 21

Sets out rules for buying and selling goods and services between two or more countries

Question 22

What is international trade

Answer 22

Through its international trade policy, the government aims to help uk businesses succeed internationally and encourages overseas companies to work with the uk

Question 23

Benefits of international trade

Answer 23

• larger market
• increased employment
• economies of scale (bulk)
• diversify risk
• benefit from lower costs in other countries
• customers have more choice

Question 24

Drawbacks of international trade

Answer 24

• big competition due to free trade
• risk of takeovers by foreign companies

Question 25

What is Social change

Answer 25

Changes over time in behaviour patterns and cultural values and norms
E.g. internet access, migration and demographic changes