Economy and Business | How the Economic Climate Impacts Business

What does the term 'economic climate' relate to?

• The performance of the economy

• The cultural trends in a society

• The weather conditions affecting agriculture

• The political stability of a country

What happens when the economic climate is negative?

• Higher rates of unemployment

• Higher wages and incomes

• More job opportunities

• Increased consumer spending

Which of the following is NOT a key way the economic climate can impact businesses?

• Weather patterns

• Inflation

• Consumer income levels

• Unemployment

What is the rate of unemployment based on?

• The number of people who are of working age and able to work but are not currently working

• The number of people who are retired

• The number of people who are self-employed

• The number of people who are studying

What happens when consumer income levels are high?

• Businesses see a drop in sales

• Consumers look for cheaper alternatives

• Consumer confidence and spending increase

• Consumer confidence and spending decrease

What does inflation describe?

• The stability of prices over time

• The fluctuation of prices over time

• The increase of prices over time

• The decrease in prices over time

What is the base rate of interest set by?

• The World Bank

• The Bank of England

• The Prime Minister

• The European Union

What is the impact of high interest rates on consumer behavior?

• Encourages borrowing and spending

• Encourages saving and reduces borrowing

• Encourages both borrowing and saving

• Has no impact on consumer behavior

Which of the following is NOT a type of government taxation mentioned?

• Property tax

• National insurance

• VAT

• Income tax

What does the exchange rate measure?

• The value of goods and services in a country

• The interest rates set by banks

• The value of one currency against another currency

• The rate of inflation in a country