Economic Policies and Business Consequences

These flashcards cover the key concepts from the lecture notes on economic policies and their consequences for businesses.

What are some possible consequences for businesses due to economic policies?

Higher borrowing costs, fall in sales, reduced production, delayed/cancelled investments, and increased costs due to currency value changes.

How can economic policies affect GDP in the economy?

By promoting export sales through reduced exchange rates, leading to increased demand and sales.

What is the effect of taxation on goods?

Taxation reduces demand for goods because it increases prices.

What is protectionism?

The extent to which the government uses controls to restrict the number of imports entering the country, often through high tariffs.

What are supply-side policies?

Economic strategies aimed at making markets work more efficiently to optimize output and improve incentives for work.

How does fiscal policy influence demand in an economy?

Through the use of taxation and government expenditure to stimulate economic growth.

What is fiscal policy?

The use of taxation and government expenditure to influence the economy.