SGS Business 1.5.5 The Economy and Business

A labor force of 20 million people has 18.5 million people employed. Find the unemployment rate.

• 10%

• 8.5%

• 7.5%

• 6%

What is the unemployment????

• decisions to work based on each individuals' valuation of their own work

• proportion of younger workers in the labor force

• the situation of actively looking for employment but not being currently employed.

• person who is simultaneously an income earner,

If a change in income appears permanent such as being promoted to a secure and high paying job, __________________.

• then people are likely to consume less.

• then people are likely to save more.

• then people are likely to consume more.

• then people are likely to save less.

Which of following best describes the term interest rate?

• The price of one currency against another

• The cost of borrowing money or reward for saving money

• The value of goods and services bought by consumers

• The reward for borrowing money or cost of saving money

Which is true in relation to the rate of inflation? Business costs are:

• More likely to increase if the rate of inflation rises

• More likely to stay the same if the rate of inflation rises

• More likely to increase if the rate of inflation falls

• More likely to decrease if the rate of inflation rises

Which of the following businesses is most likely to experience a rise in demand as consumer income falls?

• Travel agent

• A producer of chocolate

• A department store selling discounted goods

• A specialist bakery selling luxury products

What is the most likely impact of rising unemployment levels on a business selling luxury goods?

• Falling sales and rising profit

• Rising sales and falling profit

• Falling sales and falling profit

• Rising sales and rising profit

What is true of a UK importer of goods from Italy, if the value of the pound becomes weaker against the euro?

• Sales increase and profit increases

• Sales decrease and profit increases

• Sales increase and profit decreases

• Sales decrease and profit decreases

A business has borrowed money from a bank with an overdraft. If interest rates rise, the impact on the business will be:

• Costs increase and profit decreases

• Costs decrease and profit increase

• Costs increase and profit increase

• Costs decrease and profits decrease

If the government increases the rate of corporation tax, companies are likely to:

• Pay more tax and invest more into the business

• Pay more tax and invest less into the business

• Pay less tax and invest more into the business

• Pay less tax and invest less into the business