As consumer incomes rise, they choose to buy better products – luxuries As consumer incomes fall, they will need to buy cheaper products – inferior products
1 of 17
What is unemployment?
If unemployment rises people have no jobs This means that they have low incomes This also means that they have little disposable income – which is what is left after all the bills have been paid No disposable income means no luxuries
2 of 17
How do you become unemployed?
Redundant, finished school, fired, Quit the job, Ill and had to give up job
3 of 17
What is the definition of unemployed?
Unemployment - The number of people willing to work but out of work and seeking work
4 of 17
What is the rate of unemployed people?
Current unemployment rate is 4.9*%
5 of 17
what happens if inflation goes up?
If the UK inflation rate goes up consumers will feel poorer as their earned £££ will not go as far because goods have risen in price
6 of 17
is inflation a problem and why?
Inflation is a problem, if food keeps going up in price and wages don’t then soon consumers will feel poorer and not be able to afford to buy as much
7 of 17
what if the change in interest go up?
If the cost of borrowing goes up then consumers decide to save instead of spend
8 of 17
What do you buy if you go with changes in interest rates?
If consumers can borrow they can buy; clothes, cars, washing machines, houses, caravans, holidays, and just about everything else
9 of 17
What are interest rates set up by?
Interest rates are set by the bank of England and will affect; mortgages, loans, overdrafts and credit cards
10 of 17
What is the impact on the cost of borrowing to business?
If interest rates rise then the cost of borrowing will rise and this will mean that the cost of supplies for a business may increase A fall in interest rates means that the cost of servicing debt falls which may lead to an increase in profits (costs
11 of 17
what is the % of corporation tax?
20%
12 of 17
What is tax?
Tax is a cost of the business and so will have an impact on profit
13 of 17
if your business earns £83,00 what do they have to do?
If a business earns over £83,000 a year it must register for VAT
14 of 17
What is the Exchange rates?
The exchange rate is the price of one currency in exchange for another
15 of 17
Does Exchange rates change?
Currencies can change in value and this is due to the demand and supply of a currency
16 of 17
What impact will a change in exchange rates have on the cost of supplies?
? It depends if they were purchased from abroad. If our pound increased against another currency this will make imported supplies cheaper e.g. cheese from France:
17 of 17
Other cards in this set
Card 2
Front
What is unemployment?
Back
If unemployment rises people have no jobs This means that they have low incomes This also means that they have little disposable income – which is what is left after all the bills have been paid No disposable income means no luxuries
Comments
No comments have yet been made