External Influences Flashcards

All 5 cards in this deck

What is an external influence on a business?

A factor outside the business's control that affects it, e.g. technology, legislation and the economy.

What are the steps to use data in a table to draw a conclusion about a business?

e.g. a table shows UK unemployment rising from 4% to 7%

1. Read the title and units, and identify the trend: unemployment has risen.
2. State the size of the change: a rise of 3 percentage points.
3. Link it to the business: fewer customers with income to spend, so revenue is likely to fall.

Give one way a small business could respond to competitors starting to sell online.

Set up its own e-commerce website and use social media to promote it.

Give one way a business could respond to falling consumer incomes.

Cut costs and lower prices, or offer a budget range and special offers to keep customers.

What are the steps to recommend and justify a business response to an economic change?

e.g. interest rates rise

1. State the response: delay expansion and borrow less.
2. Explain the benefit: loan repayments and costs stay manageable.
3. Give a drawback or what it depends on: growth is slower; it depends on how big the rise is.