Business Economics: Factors Influencing Economic Growth and Government's Role in Business Advancement

This report explores the field of Business Economics, focusing on factors influencing economic growth and the role of government in business advancement. It provides an overview of the economic market factors in the United Kingdom and discusses the country's economic growth and development. The report also examines the challenges faced by the UK in terms of economic growth and the government's initiatives to support business growth.

Business Economics

EXECUTIVE SUMMARY
Business economics can be defined as financial mathematics that can be developed for study of
factors that have contributed to relationships of forces alongside workers, goods or financial
markets. Overall company economic questions about problems or dilemma that is relevant to
organization, administration or policies of a company.

Contents
EXECUTIVE SUMMARY.............................................................................................................2
INTRODUCTION...........................................................................................................................4
MAIN BODY..................................................................................................................................4
Background of United Kingdom along with economic growth or development:........................4
Detailed evaluation of problem of economic growth:.................................................................5
Role played by government for advancement or success of business in nation:.........................8
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10

INTRODUCTION
Economics can be defined as a social theory that involves the manufacture, delivery and usage of
goods that are necessary for the optimal utilization of funds to satisfy consumer needs. Business
economics means researching companies' economical, economic, operational or industry
problems (Brenner, 2018). It tests different variables influencing market growth plans by using
market assumptions or quantitative approaches. This research is based on an overview of the
economic market factors of the United Kingdom and the title chosen for it is progress or business
growth of the sector. It provides a summary of the United Kingdom's economic context and an
assessment of the economic structure for development or extension, along with relevant data and
graphs. In addition, the role of the government in promoting market performance in a country is
examined.
MAIN BODY
Background of United Kingdom along with economic growth or development:
UK Background: It can be claimed by the economic study of the United Kingdom that this is the
world's biggest economy in terms of financial services. The UK's overall wealth record for 2017
is 11.8 trillion US dollars. In the sense of specialized fields of financial markets, such as finance,
the nation plays an important role. In terms of financial significance, it can be alluded to as the
most imaginative, dynamic or advanced country. It can be estimated from United Kingdom
statistics that upwards of 50,000 workers operate in the banking sector or fields of facilities
corporate finance. Contribution of 0.8 percent of the gross domestic production to the nation's
asset management industry. Besides this, the nation consists of a significant variety of smaller
wealth development hubs. It is affiliated with a significant range of firms and, thus, it can be
claimed that the country has a strong financial market. After the U.S. economy, the European
Union has the second highest financial reserves worldwide. It comprises about 20 percent of the
world economy as a whole and gives a high rate of return relative to another advanced country of
advanced economies. In investing or finance, it still plays the greater function. The United
Kingdom consists of more international banks relative to the other biggest countries. In
conjunction with international banks, London City of Nation has branches or divisions of 254,
that's double compared to New York.

Economic growth can be defined as a nation's improvement in relation to its technology,
economy, state, employment or industry. This applies to enhancing the manufacturing practices
of products or services. Besides this, the market cycle is found and evaluated. It involves the
growth or advancement of the United Kingdom's finance market, gross national savings and
assets in relation to the economic advancement of the United Kingdom. With developments in
the banking industry and numerous other commercial banks, the European Union has the biggest
economy. The United Kingdom's national income increased from 0.4 per cent in October 2020 to
7.9 per cent in February 2020.
Detailed evaluation of problem of economic growth:
Illustration 1: Economic growth Issue, 2020
(Source: Economic growth Issue, 2020)
One of the big challenges that the United Kingdom faces is that the state's financial development
is slow. The country's production is below its projected growth (Strielkowski and Chigisheva,
2018). The explanation behind the low employment growth rate is the decline in the amount of
results generated and the similar amount of national demand. Although contemplating the

country's economic growth rate in the year 2019, it is known that UK income activity was below
1%. The fall in real incomes serves as an explanation for the country's declining productivity
expansion (Economic growth Issue. 2020). Inevitably, this leads to a decline in the working
conditions of residents. If the public debt ratio rises, the pressure on the government increases as
the ratio of debt to GDP rises.
Owing to its lower employment rate, the nation's rate of growth is declining. This acts as a
justification for lowering the nation's pay rate, which is a problem for the country's leadership
(Productivity for Labor, 2020). This is because of the poor living conditions of households and
the drop in tax receipts. This prohibits government expenditure vast sums of cash on public
works or health care.

(Source: debts for government, 2020)
The government-related debt factor has grown from 40 percent of GDP to 82 percent of GDP. In
contrast to previous decades, tax receipts raised by the nation have declined, while government
expenditure on welfare or health care is on the increase (Debts for government. 2020). This is
one of the key causes for economic growth to decline as investments rise while income earnings
decrease. The reduction in the nation's job rate is also an explanation for the reduced tax revenue.
Debt increases have a major effect on national politics and serve as a justification for restricting
the state of the United Kingdom's expenditure on country improvement by expenditure on
varying spending.
In order to sustain a stronger economy, countries must invest in different industries, such as the
cultural sector, manufacturing, schooling, farming and transportation (Adeola, Boso and Evans,
2018). In addition, a considerable amount of money is spent on the health system, developing

transport infrastructure, connectivity, electricity and resources. Less emphasis on important
steps, i.e., gross domestic product, trade ties, housing, welfare etc., is the reason behind the low
level of growth in the United Kingdom.
Role played by government for advancement or success of business in nation:
In business development, government plays a significant role as it offers companies with
different forms of funding. As, the nation provides companies with active workers, training
experts, customer savings, trade links, and numerous other services. Government initiatives to
enhance corporate practices allow companies to develop or expand their activities at a high
degree (Acs, Mickiewicz and Szerb, 2018). Good government trading ties with other nations
further improve the entity's client base and market image across boundaries. The government's
measures to protect the interests of consumers raise consumer trust in the buying of goods.
Following those customer practices lets businesses increase customer retention levels and
increases customer loyalty to the company. In addition to this, the government gives numerous
grants to start-ups or small companies to encourage them to expand their business activities.
Changes in government policy have an immense effect on the operations of an organization
working in a region. In addition to the abovementioned services, government is providing home
mortgages at low interest rates and provides taxes.
The following are some positions performed by the government of the United Kingdom to help
enterprises or companies:
Supporting small or medium-sized organizations: such companies provide a nation with an
immense degree of economic support, thus playing an important role in its economic growth. For
this purpose, the UK government provides numerous facilities to facilitate the activities of start-
ups in the region (Lazareva, 2019). Any of these programs allow interest at low interest rates,
offer free loans for mortgages, etc.
Technical assistance: in order to provide innovative innovations that improve the
competitiveness and quality of an enterprise and simplify the development of products or
services, the government gives big support to organizations. It improves a company's economies
of scale as the introduction of digital and economic market support allows manufacturing vast

volumes of production with comparable quality levels in less time. Creative alternatives also
allow corporate marketing teams to enhance customer service.
Economic ties: The Government of the United Kingdom broaden an enterprise's activities at a
large level while ensuring constructive trading relationships by offering foreign visibility. It
benefits companies around boundaries in an enticing large consumer market that allows customer
attractiveness to be improvised at international level. In addition to this, an enterprise's public
reputation and brand equity also increases, which eventually leads to increased appeal for
customers that allows company expansion.
CONCLUSION
The aforementioned report concludes that it is possible to explain economics as a topic involving
the notion of productive resources, scarcity, demand and delivery. It includes researching
political decisions surrounding the distribution of capital. In the sense of several variables, such
as housing, health and education, economic growth can be understood as its progress. This study
also perceives that there are many explanations for a decline in the rate of economic growth,
including a rise in the level of poverty, a decrease in development investments, etc. Furthermore,
decreases in tax revenue and rises in public debt have a negative effect on the economy. In
addition, government is playing a major role in the promotion of industry or business practices in
the nation that leads to economic growth.

REFERENCES
Brenner, B., 2018. Transformative sustainable business models in the light of the digital
imperative—A global business economics perspective. Sustainability, 10(12), p.4428.
Strielkowski, W. and Chigisheva, O., 2018. Leadership for the future sustainable development of
business and education. Springer proceedings in business and economics. Springer, Cham.
Acs, Z.J., Estrin, S., Mickiewicz, T. and Szerb, L., 2018. Entrepreneurship, institutional
economics, and economic growth: an ecosystem perspective. Small Business Economics, 51(2),
pp.501-514.
Lazareva, M.G., 2019. Entropy and information in scenario modeling of a firm: new approaches
in business economics. Problems and perspectives in management, (17, Iss. 1), pp.202-215.
Adeola, O., Boso, N. and Evans, O., 2018. Drivers of international tourism demand in
Africa. Business Economics, 53(1), pp.25-36.
Online
Economic growth Issue. 2020. [Online]. Available through < https://www.economicshelp.org >
Productivity for Labor. 2020. [Online]. Available through < https://www.economicshelp.org >
Debts for government. 2020. [Online]. Available through < https://www.economicshelp.org >