Flashcards
Summer book 3
Cards in this deck (21)
- 1Exchange rates: Imports and exportsFor an item imported into a country with an appreciating exchange rate then the consumer must pay less however if the consumer is exporting from appreciating currency country the consumer must pay more. If the currency is depreciating then the imports will be more expensive and exports less expensive so encourage higher demand.
- 2Exchange rate effects on individual consumerSame as effect on country appreciates pay less for imports but more for exports depreciates more for imports less for exports. Exchange rates effect:
Foreign holidays
Withdrawing cash from cash machines abroad
Food in supermarkets
Imported consumer goods
Direct imports of big ticket items like car and furniture
Production costs from imported raw materials - 3Other factors that affect the sales of imports and exportsStyle and image
Quality
Reliability
For example BMW or wine - 4Power of consumerCan greatly influence producers and their products to their demands by their buying choices mainly as boycotts are becoming more common as a result of consumer empowerment. Consumers also demand cheaper products meaning production facilities have been moved abroad to low labour cost countries to copete with cheap imports. Also an increasing number of people read online product review up to 69% of them passing on the info to friends. More influenctial through marketing and advertising firms can also influence
- 5Individual influence on products businesses supplyFairtrade movement aims to help power producers in developing countries gain economic self sufficiency by encouraging the payment of fair prices for products such as coffee, cocoa and fresh fruit. Examples of supermarkets that follow this are Tesco and Marks and Spencers. Consumers ready to pay to ensure supplies from undeveloped countries have a fair trade. Example of power of consumer as M and S are expanding of these products due to positive feedback. Companies fear mass boycott because creates bad publicity and decreases sales. also sweatshops used by MNC's multinational corporations because have low operating costs poor working conditions long hour and hire young kids. IN this case protesting and boycotting effective.
- 6Consumer effect on environmentConsumers can make a real difference to the environmental sustainability of food production by what they choose to buy in the supermarket. Locally sourced foods are best because cut down transport need so pollution reduced. Also helpsto support local jobs in industries such as farming boosting local economy
- 7UK Government's role in reducing world povertyDFID (Department for International Development) is part of the UK Gov that manages Britains aid to poor countries. Works to:
Eradicate extreme poverty and hunger
Achieve universal primary education
Ensure environmental sustainability
Done by tackling causes of poverty like settling conflicts, increasing trades, by reducing import taxes and paying fair prices, and given directly to foreign governments of poor countries. - 8Effects of globalisation on the UK laour marketIn EU freedom to work in any EU country is guaranteed for most EU citizens. Firms choosing to locate factories abroad more due to lower labor costs, cost of employing workers, and production costs.
- 9Advantages to firms of operating overseasLower operating and labour costs
Firms have increased competitiveness
Exchange rates - if the exchange rate falls it lowers export prices
Firms are nearer to market and sources of materials reducing transport and distribution costs - 10Disadvantage of firms operating overseasJobs are lost in Uk
Difficulty in controlling operations
Unfamiliar cultures and language
Transport cost to home markets - can vary with the oil price
Exchange rate change - changes can go against you , making trading more expensive and reducing profits from overseas factories. - 11Why foreign firms choose to operate in UKCan be done b either set up factories in UK or taking over existing companies like Tata Steel that took over Jaguar and Land Rover in 2008. UK is one of the top economies in the world for foreign direct investment, holding over 20% of all the inward investment stock in the 27 EU countries.
- 12Reasons why firms locate in UKHigh skilled labour force and higher quality production
Tariff free access to the European Single Market (500 million consumers)
Buy existing UK owned brands and distribution networks
Englis language is the accepted international language of business, science and technology. - 13Problem created from foreign firms or MNC's closing a plantJobs are lost at plant itself
Jobs are lost from other UK companies who supply the plant (derived demand) - 14Mobility of labour - the ability of workers to change between jobsThis is due to globalisation as growing variety of jobs abroad for UK workers, also driven by foreign firms and MNC's taking over companies as well as vice versa. Regions depenant on low skilled manufacturing may see unemployment as lower labour costs abroad. While those offering highly skilled labour or specalised services may experience employment as those with such knowledge relocate to UK
- 15Open economyOne that trades with other countries
- 16Benefits of globalisation for the UK labour marketJobs are created in sectors where the UK does well
New migrant labour skills lower costs and increase competitiveness
Opportunities to increase exports to new markets
Job shortages filled - 17Drawbacks of globalisation for the UK labour marketLow skill jobs are lost particularly affecting manufacturing regions of the UK
Increase in immigrant labour decreases wages
Relocating production overseas ca cause unemployment. - 18Impact of immigration on the UK economyPositive:
Bringing new knowledge and skills and filling gaps in the labour market
Reducing wage inflation and increasing competitiveness
Provinding more workers to support the UK ageing population
Increasing the number of consumers as well as producers
Negative:
Depresses wages and can displace low skilled UK workers
Increases strain on social services, education and hospitals - 19Impact of emmigration on UK economynegative:
Losing valuable skills/ human capital - brain drain
reducing unemployment in recessions - 20Barriers in migrationLanguage and cultural barriers
Visas, work permits and so on needed outside EU
restrictions by foreign government - 21Government actions to regulate labour migrationPints system: Potential immigrants score points according to how well their skills match those needed in the UK
SAWS (Seasonal Agricultural Workers Scheme) allows farmers and growers to bring foreign people to the UK to do seasonal and agricultural work
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- A-Level Economics Flashcards on Summer book 3, created by Chima Power on 20/01/2014.
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- Chima Power
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