Key term
Edexcel A-Level Business 9BS0
Meeting Customer Needs
Marketing Mix and Strategy
Managing People
Entrepreneurs and Leaders
Financial Planning
Managing Finance
Resource Management
External Influences
Business Objectives and Strategy
Decision-Making Techniques
Influences on Business Decisions
Assessing Competitiveness
Globalisation
Global Markets and Business Expansion
Global Marketing
Global Industries and Companies
External Influences
Economic influences
- 8 things to know
- Paper 2 and Paper 3
Overview
Inflation, exchange rates, interest rates, taxation and government spending, the phases of the business cycle from boom to recovery, economic uncertainty, and calculating and interpreting index numbers.
What you need to know
Answer each one before you reveal it.
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Process
How does a weaker currency affect imports and exports?
Process
How do interest rates affect consumers and business investment?
Evaluation
How does government fiscal policy affect businesses?
Process
What happens to business investment during a recession?
Key term
How might consumer confidence change as an economy enters a slump from a recession?
Key term
What is economic uncertainty?
Key term
How might businesses adjust their workforce in response to economic uncertainty?
Questions from this subtopic
Each one with the model answer underneath.
- 1
What is inflation?
Model answer
A sustained increase in the general price level of goods and services in an economy over time.
- 2
What does the rate of inflation measure?
Model answer
The percentage change in the price level over a specific period, typically one year.
- 3
What is the Consumer Prices Index (CPI)?
Model answer
A measure of inflation that tracks the average change in prices paid by consumers for a basket of goods and services.
- 4
How does rising inflation affect business costs?
Model answer
It increases costs for raw materials, wages, and other inputs, potentially squeezing profit margins.
- 5
Why does inflation create problems for business planning?
Model answer
It creates uncertainty as future costs and revenues become harder to predict.
- 6
How might high inflation affect consumer demand?
Model answer
It may reduce consumer purchasing power, leading to lower demand for non-essential goods and services.
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