1.5.5 - External influences

Changes in which of the following external influences is most likely to have led to the development of online businesses such as travel agents?

• Technology

• Interest rates

• Legislation

• Exchange rates

Which of the following best describes the term economic climate?

• Factors inside the business that influence its activities

• The measurement of whether the production and consumption of goods is strong or poor in a specific country or region

• Government rules and regulations that affect business activity

• Buying and selling goods electronically

When the economic climate is strong, businesses that have high demand for their products are likely to:

• Hire fewer staff and invest more

• Hire fewer staff and invest less

• Hire more staff and invest more

• Hire more staff and invest less

If the pound becomes weaker, a UK importer may experience:

• An increase in sales and costs

• A decrease in sales and costs

• An increase in sales and a decrease in costs

• A decrease in sales and an increase in costs

Rising inflation is an example of a change in:

• Legislation

• Technology

• Government taxation

• The economic climate

Legislation designed to reduce landfill aims to encourage businesses to:

• Decrease their levels of recycling and send more to landfill

• Decrease their levels of recycling and send less to landfill

• Increase their levels of recycling and send more to landfill

• Increase their levels of recycling and send less to landfill

A business that operates in a competitive environment is most likely to reduce prices when the economic climate is:

• Weak and consumer spending is high

• Weak and consumer spending is low

• Strong and consumer spending is high

• Strong and consumer spending is low

Changes in which external influence has meant that UK businesses have to pay employees the national minimum wage?

• Technology

• Economic climate

• Legislation

• Changes in lifestyle

As unemployment levels fall, in order to recruit the best staff, businesses might respond by:

• Decreasing wage rates to reduce costs

• Decreasing wage rates to reduce profit levels

• Increasing wage rates to increase staff retention

• Increasing wage rates to lower staff retention

When the economic climate is weak, businesses which are experiencing a fall demand for their products might:

• Reduce prices and spend less on product development

• Reduce prices and spend more on product development

• Increase prices and spend less on product development

• Increase prices and spend more on product development