20589399
Description
Flashcards by One Fish Two Fish, updated more than 1 year ago
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Created by One Fish Two Fish
almost 5 years ago
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| Question | Answer |
| Social STEEPLE factor | population size and structure (aging population, life expectancy), role of women, lifestyle (retirement), age groups, immigration and education levels |
| Technological STEEPLE factor | Factors include the state of technological advancement and introduction of new technologies |
| Economic STEEPLE factor | Factors such as the GDP growth rate, inflation rates, interest rates, exchange rates |
| Political STEEPLE factor | type of government, its attitude to free markets, imposition of tariffs, business incentives offered and the stability of the government |
| Legal STEEPLE factor | any law influencing business activity, e.g. competition, law, health and safety at work, consumer protection, employee protection |
| Ethics STEEPLE factor | general code of ethics followed by most people in the country, and the tendency of people to be ethical |
| economic growth | increases in the level of a country's gross domestic product or GDP (total value of output) |
| recession | 6 months (two quarters) of falling GDP (negative growth) |
| exchange rate | value of one currency in terms of another currency |
| Technological impact on objectives and strategies | - reduce product development time, speed up manufacturing -improving stakeholder communication - developing new and better processes -cost benefits -outsourcing and offshoring |
| computer-aided design (CAD) | using computers and IT when designing products |
| computer-aided manufacturing (CAM) | the use of computers and computer-controlled machinery to speed up the production process and make it more flexible |
| Fiscal policy | Changes in government spending levels and tax rates |
| Inflation | the rate of change of the average level of prices |
| cost-push inflation | caused by rising costs forcing businesses to increase prices |
| demand-pull inflation | caused by an excess demand in an economy, e.g. an economic boom, allowing businesses to raise prices |
| Impact of economic growth and recession on business objectives and strategies | Economic growth: increase demand for goods and services as consumers have higher incomes, inferior goods may be rejected Recession: business retrenchment, closures and redundancies, cheaper inferior goods will benefit - business flexibility is important for survival |
| Interest rates on business objectives and strategies | - increase in interest rates will reduce customer demand for products bought on credit (e.g. houses and cars) - increase loan capital will reduce profits for a business with high debt -business expansion plans delayed or cancelled |
| Exchange rates- decreases (depreciation) in the value of a currency value against other currencies | - imported goods more expensive CONS: more expensive to import capital goods for production PROS: domestic products become more competitive overseas -try to buy domestic supplies -businesses might target foreign markets more |
| Exchange rates- increases (appreciation) in the value of a currency value against other currencies | - imported goods cheaper PROS: cheaper to use imported capital goods in production process CONS: imported goods become more price competitive against domestically produced products - exported products less competitive |
| Tax changes through the use of fiscal policy on business objectives and strategies | -higher rates of income tax reduce consumers' disposable income, demand for luxury products will fall -higher corporation tax reduces the profits of tax of companies, might relocate to another country |
| Unemployment effect on business strategies and objectives | - give more choices in employee recruitment -wages may reduce or not increase in line with inflation -average consumer incomes are likely to fall |
| Inflation (cost-push) on business strategies and objectives | -higher wage demands from workers to maintain real incomes during inflation and - if businesses do not want to increase price, profit margins may fall -seek cheaper sources of supply or more efficient methods to decrease costs per unit |
| Inflation (demand-pull) | -encourage firms to raise prices to increase profit margins |
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