Area covered Assessment criteria Assignment
Learning outcome 3 - the impact of the economic environment on business
How economic environment affects different businesses
Content
The economic environment consists of
External factors in a business' market and the broader economy that can influence a business. You can divide the economic environment into:
• The microeconomic environment - which affects business decision making - such as individual actions of firms and consumers(Market size, Demand, Supply, Competitors, Suppliers and Distribution chain, such as retailer stores)
• The macroeconomic environment - which affects an entire economy and all of its participants. Many economic factors act as external constraints on your business, which means that you have little, if any, control over them (Interest rates, Taxes, Inflation, Currency exchange rates, Consumer discretionary income, Savings rates, Consumer confidence levels, Unemployment rate, Recession and Depression) • Describe at least two economic environment micro or macro.

• Comparison of two contrasting economic environment - challenges business face
• Describe how political factors impact on business activities during an economic environment(recession) i.e. recruitment of staff
• social factors impact on business activities i.e. ethics( the business social responsibility policy) and suppliers and distribution chain
• and legal factors impact on business activities i.e. employment law during recruitment of staff

• Compare and contrast the political and social environment in two different places so as to gain an understanding of the importance of these factors( information about doing business in another country through research)
Use the basic principles of business law and its importance in providing a framework in which business operates Analyse how political, legal and social