Describe barriers to growth for LEDC's ?
Barriers to economic growth exist in LEDC's, which are poorer countries that have found it difficult to grow, and these barriers act as a restraining force for business that want to expand overseas. some barriers that make it difficult for a country to achieve economic growth are found when a country had a lack of infrastructure, which is communication and transport networks such as road systems, schools, hospitals, housing and basic electricity.
a lack of technical knowledge and labour force can also act as barriers for a country. if there is a rapid population growth the country will find that there are too many people to feed. when a country suffers from high foreign debt repayments it is left with very little money for domestic investment and growth.
Thursday, December 31, 2009
question 5
How can the labour force of a country change?
Changes in the labour force can be caused by,
Change in demography: a fall in birth rate in developed countries, people choosing to start work later for educational reasons and retiring early because of rising income are reasons that will reduce the size of the workforce.
Changes in participation rates: a higher participation rate can be caused by government incentives such as lower rates of income tax. due to an increase in the number of women that are returning to or starting work has also increased participation rates in different regions of the world.
Changes in net migration: this refers to the difference between immigration and emigration. if the net migration is positive then the size of the workforce will increase.
Changes in the labour force can be caused by,
Change in demography: a fall in birth rate in developed countries, people choosing to start work later for educational reasons and retiring early because of rising income are reasons that will reduce the size of the workforce.
Changes in participation rates: a higher participation rate can be caused by government incentives such as lower rates of income tax. due to an increase in the number of women that are returning to or starting work has also increased participation rates in different regions of the world.
Changes in net migration: this refers to the difference between immigration and emigration. if the net migration is positive then the size of the workforce will increase.
question 4
How does growth occur via improved quality of factors of production?
Growth via improved quality of factors of production requires an investment in key resources of the economy such as,
Capital Goods: the greater the level of investment, the higher economic growth tends to be.
Education and training: if the workforce is trained better and more educated the workforce will become more productive.
Health technology: health care helps ensure the health of the workers and a healthy workforce is likely to be more productive. this can also prevent workers from taking time off or retire because of their illness.
Growth via improved quality of factors of production requires an investment in key resources of the economy such as,
Capital Goods: the greater the level of investment, the higher economic growth tends to be.
Education and training: if the workforce is trained better and more educated the workforce will become more productive.
Health technology: health care helps ensure the health of the workers and a healthy workforce is likely to be more productive. this can also prevent workers from taking time off or retire because of their illness.
question 3
Explain 4 ways businesses can cope with a recession.
Cost reduction:- there are methods such as finding alternative suppliers who offer the product you need at better prices or moving to a cheaper location should help cash flow during a recession.
Price Reduction:- during a recession people become more aware of prices so lower prices will be more attractive to the public.
Branding:- can help during a recession because customer who are loyal to the brand will continue purchasing its products regardless of price change helping the brand maintain its sales.
Outsourcing:- the cost of production might be lower overseas so this could help a business gain a competitive price advantage and increase its profits. this will help reduce the impact of any recession in the country's market.
Cost reduction:- there are methods such as finding alternative suppliers who offer the product you need at better prices or moving to a cheaper location should help cash flow during a recession.
Price Reduction:- during a recession people become more aware of prices so lower prices will be more attractive to the public.
Branding:- can help during a recession because customer who are loyal to the brand will continue purchasing its products regardless of price change helping the brand maintain its sales.
Outsourcing:- the cost of production might be lower overseas so this could help a business gain a competitive price advantage and increase its profits. this will help reduce the impact of any recession in the country's market.
Economic Growth Exercise question 2
2.
Peak or Boom
Economic activity at highest, Consumer expenditure, investment and export earnings, unemployment will be low, consumer and business confidence will be high, possible increase in wages, business have very good cash flow
Recession
Declining aggregate demand, lower investment expenditure, falling export sales, rising unemployment,
Slump or Trough
High level of unemployment, very low levels of consumer spending, investment and export earnings, poor cash flow
Recovery or Expansion
GDP rises, national income begins to increase, consumption, investment, and employment will also increase
Peak or Boom
Economic activity at highest, Consumer expenditure, investment and export earnings, unemployment will be low, consumer and business confidence will be high, possible increase in wages, business have very good cash flow
Recession
Declining aggregate demand, lower investment expenditure, falling export sales, rising unemployment,
Slump or Trough
High level of unemployment, very low levels of consumer spending, investment and export earnings, poor cash flow
Recovery or Expansion
GDP rises, national income begins to increase, consumption, investment, and employment will also increase
Tuesday, December 29, 2009
Skoda Case Study
a) two stakeholders in Skoda would be employees and managers and directors
b) the conflict in the case study is between the employees and the managers/directors or shareholders. the employees were on a strike because they were concerned about their wages and benefits. this would've been caused due to a pay-cut or cancellation of a benefit they had. if Skoda had increased the wages of their managers and directors the wages of the employees would be effected. Shareholders might have demanded more profit which resulted in a pay-cut from the employees salary, enabling the company to give more to their shareholders.
c) the conflict can be minimized by Skoda working on getting the employees to end the strike and start working again. they could do this by giving them their salary and no more pay-cuts. after this is done, i believe that if Skoda increases staff motivation this will encourage the employees to increase their production level which will lead to profit. this way Skoda will gain the money they lost and in the long run make more profit, and the shareholders will also be pleased because they will be making more money. if Skoda didn't want to publicize the strike that occurred they could also employ a good public relations firm. this would help Skoda recover by publicizing the positive work they are doing. they could do this by communicating frequently with their stakeholders such as their employees and the local commuity.
b) the conflict in the case study is between the employees and the managers/directors or shareholders. the employees were on a strike because they were concerned about their wages and benefits. this would've been caused due to a pay-cut or cancellation of a benefit they had. if Skoda had increased the wages of their managers and directors the wages of the employees would be effected. Shareholders might have demanded more profit which resulted in a pay-cut from the employees salary, enabling the company to give more to their shareholders.
c) the conflict can be minimized by Skoda working on getting the employees to end the strike and start working again. they could do this by giving them their salary and no more pay-cuts. after this is done, i believe that if Skoda increases staff motivation this will encourage the employees to increase their production level which will lead to profit. this way Skoda will gain the money they lost and in the long run make more profit, and the shareholders will also be pleased because they will be making more money. if Skoda didn't want to publicize the strike that occurred they could also employ a good public relations firm. this would help Skoda recover by publicizing the positive work they are doing. they could do this by communicating frequently with their stakeholders such as their employees and the local commuity.
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