2.5- External Influences

Question 1

What is legislation?

Answer 1

A set of laws suggested by government and made official by parliament.

Question 2

What are the 5 categories of legislation?

Answer 2

Consumer protection, employee protection, environmental protection, competition policy, health and safety.

Question 3

What are economic influences?

Answer 3

Economic influence is when a business is affected in any way by economic factors (e.g inflation, exchange rates etc)

Question 4

What is inflation?

Answer 4

• ‘Too much money chasing too little goods’.
• This year £545 is the same as £500 last year.

Question 5

What is the Consumer Price Index (CPI)?

Answer 5

• Measures the overall change in consumer prices based on a representative basket of goods and services over time.
• Used to measure inflation.
• As inflation rises so does the costs of products and services.

Question 6

What is the appreciation of the pound?

Answer 6

• SPICED; strong, pound, imports, cheaper, exports, dearer

Question 7

What is depreciation of the pound?

Answer 7

• WPISEC; weak, pound, imports, dearer, exports, cheaper.