Business Impact of Economic Changes Quiz
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Questions and Answers

What is the impact of rising inflation on businesses?

  • Businesses will be able to easily recruit new employees as unemployment falls
  • Businesses' costs will decrease, leading to lower prices for customers
  • Businesses' costs will increase, leading to higher prices for customers (correct)
  • Businesses will see an increase in sales as customers have more disposable income

    • What is the most likely impact of a fall in economic output on businesses?

  • Businesses will experience a rise in average living standards as the population grows.
  • Businesses will be able to expand and invest more due to higher profits.
  • Businesses will need to hire more workers to meet increased demand.
  • Businesses are unlikely to expand as there is less need for their products or services. (correct)

    • How does a growing GDP impact businesses?

  • Businesses will see decreasing sales as consumers have less disposable income
  • Businesses will need to decrease prices to remain competitive in the market
  • Businesses will benefit from increasing sales as more people have jobs and income to spend (correct)
  • Businesses will face difficulty recruiting new employees as unemployment rises

    • What is the primary impact of a country running out of foreign currencies on its balance of payments?

    <p>The price of the country's currency will fall against other currencies.</p> Signup and view all the answers

    What is the impact of low unemployment on businesses?

    <p>Businesses will need to pay higher wages to attract and retain employees</p> Signup and view all the answers

    How does an increase in income tax most directly impact businesses?

    <p>Businesses will have less money after taxes, which could lead to a fall in sales.</p> Signup and view all the answers

    How does low inflation impact businesses?

    <p>Businesses will face difficulty in expanding their operations</p> Signup and view all the answers

    What is the primary impact of an increase in import tariffs and quotas on businesses?

    <p>Businesses that compete with imported goods will benefit, but those that rely on imported raw materials will have higher costs.</p> Signup and view all the answers

    What is the impact of rising unemployment on businesses that sell cheaper products?

    <p>These businesses will see an increase in sales as customers look for more affordable options</p> Signup and view all the answers

    How do higher interest rates most directly impact business investment?

    <p>Higher interest rates will make it more expensive for businesses to borrow money to finance investment and expansion.</p> Signup and view all the answers

    How does low unemployment impact a business's ability to recruit new employees?

    <p>Low unemployment makes it more difficult for businesses to recruit new employees</p> Signup and view all the answers

    Which of the following is the primary way that government spending changes can impact businesses?

    <p>Increased government spending will create more demand in the economy, which can benefit businesses.</p> Signup and view all the answers

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