The Business Environment - P5

The Economic Environment



The economy represents what happens in a business
environment and it is related to human activities like
production, distribution, exchange, and consumption of goods
and services of a country.

The economy is measured by GDP (Gross Domestic Products)

GDP stands for Gross Domestic Products and measures the
import and the export of a country, and also their value of
goods.

CREDIT CRUNCH represents the amount of money that banks
are willing to lend to customers.

RECESSION means a decline in the economy. All the prices of
houses and goods decrease.

The economy of a country can be affected by 3 activities:

- Demand
Demand is the quantity of goods and services that
consumers buy at a given price.

- Supply
Supply represents the quantity of goods or services that a
business is willing to supply at a given price.

- Inflation
Inflation is based on the products prices. It can affect the
customers and the business by increasing and decreasing
prices of goods and services.

, The UK Economic Environment


- Population – 63.2m
- Net Migration is 163,000
- 22 largest pop in world
- 99% literacy rate
- GDP: +0,7%
- Unemployment rate- 6%
- Interest rate : +0,5%
- Inflation Rate: +0,5%

Unemployment:
- Youth UE – 21%
- Public sector UE is rising
- Private Sector is falling

Inflation:
- 2.8% - CPI
- 3.3% - RPI
- CPI – consumer prices index
- RPI – retail prices index
- Trend – holding steady
- Good compared to other nations



The CHINA’s Economic Environment


- Population - 1.357 billion
- Net Migration is 1,000 persons
- Unemployment Rate: 4,6 %
- Inflation Rate : 2,6 %
- GDP: +1,5%
- Interest Rate: +5,6%
- Inflation Rate: +0,3%

The Impact of GDP on STARBUCKS: