A2 Business - The Marketing Environment 0.0 / 5 ? Applied BusinessThe Marketing EnvironmentA2/A-levelOCR Created by: aidanno1billCreated on: 03-05-16 09:20 Economic Growth An increase in the value of good and services produced by an economy over time 1 of 22 GDP (Gross Domestic Product) The value of goods and services produced by an economy over a specific period 2 of 22 GDP Formula Consumption + Investment + Gov Spending + Net Exports 3 of 22 Consumption Household spending on goods and services 4 of 22 Investment Covers investment spending on government products 5 of 22 Government Spending Spending by the government on goods and services 6 of 22 The Business Cycle Sequence of Slump, Recovery, Boom & Recession 7 of 22 Boom High levels of consumer spending, business confidence, profits and investment. Price and Costs rise faster. Unemployment low. 8 of 22 Recession Defined by a fall in GDP for two consecutive quarters. Falling levels of consumer spending and confidence mean lower profits for business 9 of 22 Slump Very weak consumer spending and business investment. Many business failures. Rapidly rising unemployment 10 of 22 Recovery Consumers begin increasing their spending. Businesses feel more confident and begin to invest again 11 of 22 Cyclical Business A business where demand is closely linked to GDP 12 of 22 Counter-Cyclical Business A business that may thrive even when the economy is weak 13 of 22 Credit Crunch Liquidity Crisis. Banks become nervous about lending money to each other and to other business customers 14 of 22 Business Model How a business organises its activities to generate income and incur costs 15 of 22 Tipping Point The point in time at which new technology becomes mainstream 16 of 22 Social Environment The way in which changes in society affect a business activities 17 of 22 Pay Equality Law Men and Women are entitled to equal pay for work of equal value 18 of 22 National Minimum Wage Employers are required to pay their staff a minimum amount. Based on their age. 19 of 22 Employment right Something an employee is entitled to that is protected by law 20 of 22 Price Fixing Agreeing prices with competitors to force customers to pay a high price and maximise profits 21 of 22 PESTLE External factors affecting a business. Political, Economic, Social, Technological, Legal, Environment 22 of 22
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