Podcast
Questions and Answers
The act of selling state-owned and controlled business organizations to investors in the private sector is known as ______.
The act of selling state-owned and controlled business organizations to investors in the private sector is known as ______.
privatization
The transfer of privately owned businesses to state ownership and control is called ______.
The transfer of privately owned businesses to state ownership and control is called ______.
nationalization
Which of the following is NOT an advantage of privatization?
Which of the following is NOT an advantage of privatization?
Legal constraints on business activity can include restrictions on competition.
Legal constraints on business activity can include restrictions on competition.
Signup and view all the answers
Minimum wage laws are designed to prevent the exploitation of poorly organized workers.
Minimum wage laws are designed to prevent the exploitation of poorly organized workers.
Signup and view all the answers
Written contracts of employment are mandatory in all countries to protect the rights of workers.
Written contracts of employment are mandatory in all countries to protect the rights of workers.
Signup and view all the answers
Health and safety regulations at work are considered a legal requirement in most countries.
Health and safety regulations at work are considered a legal requirement in most countries.
Signup and view all the answers
Governments can play a role in promoting competition by preventing monopolies and encouraging mergers and takeovers.
Governments can play a role in promoting competition by preventing monopolies and encouraging mergers and takeovers.
Signup and view all the answers
Collusion is a practice where businesses agree to work together to fix prices and share contracts, restricting competition.
Collusion is a practice where businesses agree to work together to fix prices and share contracts, restricting competition.
Signup and view all the answers
Corporate social responsibility refers to a business accepting its legal and moral obligations to all stakeholders.
Corporate social responsibility refers to a business accepting its legal and moral obligations to all stakeholders.
Signup and view all the answers
Window dressing in accounting refers to the practice of making a company look better than it actually is.
Window dressing in accounting refers to the practice of making a company look better than it actually is.
Signup and view all the answers
Incentive payments always involve bribes or illegal payments.
Incentive payments always involve bribes or illegal payments.
Signup and view all the answers
A social audit reports on the impact a business has on society.
A social audit reports on the impact a business has on society.
Signup and view all the answers
Social audits are always required by law for all businesses.
Social audits are always required by law for all businesses.
Signup and view all the answers
Social audits can be used to identify areas where a business can improve its social performance.
Social audits can be used to identify areas where a business can improve its social performance.
Signup and view all the answers
Social audits always increase a company's sales.
Social audits always increase a company's sales.
Signup and view all the answers
Businesses that consider community needs are often more socially responsible.
Businesses that consider community needs are often more socially responsible.
Signup and view all the answers
Pressure groups are primarily concerned with protecting the environment.
Pressure groups are primarily concerned with protecting the environment.
Signup and view all the answers
Pressure groups aim to influence consumers to change their purchasing habits.
Pressure groups aim to influence consumers to change their purchasing habits.
Signup and view all the answers
Lobbying the government is a common strategy used by pressure groups.
Lobbying the government is a common strategy used by pressure groups.
Signup and view all the answers
Demographic changes refer to changes in the size and structure of population.
Demographic changes refer to changes in the size and structure of population.
Signup and view all the answers
Globalization can be defined solely as the increasing freedom of movement of people.
Globalization can be defined solely as the increasing freedom of movement of people.
Signup and view all the answers
An aging population is a demographic change that can impact business strategies and demand for products.
An aging population is a demographic change that can impact business strategies and demand for products.
Signup and view all the answers
The impact of globalization on business is always positive and leads to increased profits.
The impact of globalization on business is always positive and leads to increased profits.
Signup and view all the answers
Information technology (IT) refers to the use of computers and other digital tools to gather, store, process, and communicate information.
Information technology (IT) refers to the use of computers and other digital tools to gather, store, process, and communicate information.
Signup and view all the answers
IT has had little impact on the way businesses operate.
IT has had little impact on the way businesses operate.
Signup and view all the answers
IT has no potential to reduce costs for businesses.
IT has no potential to reduce costs for businesses.
Signup and view all the answers
IT can pose challenges for businesses, particularly in the area of workforce relations.
IT can pose challenges for businesses, particularly in the area of workforce relations.
Signup and view all the answers
Job enrichment aims to expand the responsibilities and autonomy of employees by giving them more challenging and fulfilling work.
Job enrichment aims to expand the responsibilities and autonomy of employees by giving them more challenging and fulfilling work.
Signup and view all the answers
Introducing new technology is always a smooth process with no challenges or unforeseen complications.
Introducing new technology is always a smooth process with no challenges or unforeseen complications.
Signup and view all the answers
In a competitive market, the greater the number of competitors and their combined market share, the more market power individual businesses have.
In a competitive market, the greater the number of competitors and their combined market share, the more market power individual businesses have.
Signup and view all the answers
The ease of entry for new businesses into a market can influence the market power of existing businesses.
The ease of entry for new businesses into a market can influence the market power of existing businesses.
Signup and view all the answers
The number of suppliers in a market has no impact on the ability of a business customer to influence prices and credit terms.
The number of suppliers in a market has no impact on the ability of a business customer to influence prices and credit terms.
Signup and view all the answers
Protectionism aims to protect domestic industries from foreign competition.
Protectionism aims to protect domestic industries from foreign competition.
Signup and view all the answers
Free international trade refers to trade conducted with no restrictions or barriers between countries.
Free international trade refers to trade conducted with no restrictions or barriers between countries.
Signup and view all the answers
Technology has no significant impact on international trade.
Technology has no significant impact on international trade.
Signup and view all the answers
A multinational business is one that operates in multiple countries but is solely owned and controlled by one country.
A multinational business is one that operates in multiple countries but is solely owned and controlled by one country.
Signup and view all the answers
Multinational businesses are often characterized by their large size and have a significant impact on the global economy.
Multinational businesses are often characterized by their large size and have a significant impact on the global economy.
Signup and view all the answers
Multinational businesses always have a positive impact on the host countries where they operate.
Multinational businesses always have a positive impact on the host countries where they operate.
Signup and view all the answers
Environmental issues are not relevant to businesses and have little impact on their operations.
Environmental issues are not relevant to businesses and have little impact on their operations.
Signup and view all the answers
Environmental audits are a tool used to independently assess a business's environmental performance.
Environmental audits are a tool used to independently assess a business's environmental performance.
Signup and view all the answers
Greenwashing refers to the practice of a business making misleading or exaggerated claims about its environmental friendliness.
Greenwashing refers to the practice of a business making misleading or exaggerated claims about its environmental friendliness.
Signup and view all the answers
Sustainability is a concept that encourages actions that meet the needs of the present without compromising the ability of future generations to meet their needs.
Sustainability is a concept that encourages actions that meet the needs of the present without compromising the ability of future generations to meet their needs.
Signup and view all the answers
Green consumerism refers to the trend of consumers choosing products that are produced sustainably without environmental damage.
Green consumerism refers to the trend of consumers choosing products that are produced sustainably without environmental damage.
Signup and view all the answers
Study Notes
External Influences on Business Activity
- Privatization: The act of selling state-owned businesses to private investors.
- Nationalization: The transfer of privately owned businesses into state ownership.
- Privatization Advantages: Greater efficiency, motivating managers and employees, market forces drive business success, raising finance for the government.
- Privatization Disadvantages: Businesses may focus on profit, ignoring social needs, lack of coordinated industrial policy, potential for monopolies exploiting consumers.
- Nationalization Advantages: Government control, integrated industrial policy, economies of scale, incentives to address social needs.
- Nationalization Disadvantages: Potential for inefficiency, less profit drive, less incentive to operate effectively, reduced flexibility.
- Privatization and Transfer of Ownership: State-owned industries transformed into private limited companies. Shares sold on the stock exchange.
- Legal Constraints on Business Activity: Employment practices, conditions, and wage levels. Marketing behavior and consumer rights. Competition and location.
- Legal Constraints on Businesses Examples: minimum wage legislation, worker protection laws, employment contracts, health and safety regulations, minimum age limits for employment, product safety and other similar practices.
- The Law and Employment Practices: Laws control employer-employee relationships. Objectives prevent exploitation and maintain health and safety.
Minimum Wage
- Defined as the minimum pay per hour, week, or month that employers can legally pay to their employees.
- Protects workers from exploitation.
Recruitment, Employment Contracts, and Termination of Employment
- Written employment contracts detail pay, condition of work and relevant disciplinary procedures.
- Minimum ages of employable people.
- Maximum length of working week.
- Holiday and pension entitlements.
- No discrimination in recruitment, selection or while at work based on protected characteristics.
Health and Safety at Work
- Legal requirement to provide a safe working environment free of hazards, provide required safety equipment and training, provide appropriate washing facilities and other required safety related amenities.
Consumer Protection Laws
- Goods and services must be fit for intended use and safe.
- Firms liable for harm caused by dangerous or defective products.
- Misleading descriptions of goods prohibited.
- Companies must follow product safety laws.
- Laws on weights and measures need to be followed.
- Laws for consumer product protection.
Impact on Business of Consumer Protection Laws
- Increased business costs: redesigning, improving quality control and measuring accurately costs of items, products, weights and measures.
- Benefits: reduced risk of lawsuits, improved customer loyalty, reduced customer injury, improved reputation.
Corporate Social Responsibility (CSR)
- Business accepts legal and moral obligations to all stakeholders.
- Ethical accounting.
- Avoiding illegal payments to influence decision making.
Social Audit
- Report on the impact a business has on society.
- Highlights social responsibility efforts.
- Example data: health and safety records, pollution levels, contributions to charities, percentages of supplies.
Demographic Changes
- Local, national, and global level changes:
- Increase in local population.
- Changes in birth rates.
- Aging population.
- Global population growth
Demographic Changes Impact on Businesses
- Changes in demand for goods and services:
- Construction: smaller housing, assisted living
- Businesses adjust to change: changing workforce demographics, new training needs
Impact of Technological Change
- New products (electronics) and processes.
- Reduced costs and productivity gains.
- Better communications (social media)
- Increased data for decision making.
- Potential threats: costs, workforce relations.
Information Technology (IT)
- Use of electronic tech for communication, information gathering, storage, and processing.
Globalization's Impact on Business Activity
- Increase in trade: Increased volume of goods and services traded globally.
- International trade agreements: Agreements have led to significant reduction in trade barriers, leading to more significant global trade.
- Protectionism: Government measures to protect domestic industries from foreign competition, for example tariffs or quotas.
- International Trade Impacts: decline in domestic industries due to imports, switch to comparative advantage products.
- Free international trade: trade with no barriers or restrictions.
Multinational Businesses
- Businesses that operate in multiple countries.
- Advantages: access to new markets, lower costs, access to resources.
- Disadvantages: communication difficulties, lack of local knowledge.
- Why become multinational? Easier access to resources, lower costs, meet consumer demands, avoid tariffs, and have access to multiple skilled workers.
Environmental Issues on Business
- Environmental Impact: Businesses' activities can have significant environmental impact.
- Environmental Protection Laws: Businesses need to comply with these to avoid penalties. -Advantages of environmentally conscious business decisions : potential cost savings from using recycled materials and energy efficient equipment, reduced risks of negative publicity and lawsuits.
- Disadvantages of environmentally conscious business decisions : higher initial startup costs for equipment, potential for lowered profits, negative publicity/consumer reactions to the negative environmental impacts of past activities of the business.
- Environmental Audits: Businesses check their environmental performance.
Sustainability
- Activities satisfying present needs without harming future generations.
- Green consumerism: consumers prioritize environmentally friendly products.
- Sustainable business decisions are now a necessity for businesses in many countries.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Related Documents
Description
This quiz explores the concepts of privatization and nationalization, examining their advantages and disadvantages. It highlights how these processes affect business efficiency, government control, and the market dynamics. Test your knowledge on the impact of these external influences on business operations.
