BMP4003 Business Environment Exam Paper 2022/22

Prepare for your BMP4003 Business Environment exam with this solved exam paper from Desklib. Learn about the Monetary Policy Committee, government policies for economic growth, supply-side policies, types of unemployment, economic cycles, and market structures. Includes a brief description of each topic and examples to illustrate the points. Also includes information on the exam release and submission dates.

BSC (Hons) BUSINESS MANAGEMENT
SEMESTER 2, EXAMINATION 2021/22
BUSINESS ENVIRONMENT
MODULE NO: BMP4003
Exam Paper Release Date & Time: Saturday 17 September 2022 at 10:00am
Submission Cut-off Date & Time: Monday 19 September 2022 at 10:00am
---------------------------------------------------------------------------------------------------------------
ANSWER BOOKLET
All the pages of the answer booklet should be submitted including blank ones.
Please type your answers in the spaces provided.
Insert additional pages where required.
Student Name
ID Number

Section A
1. Briefly describe and explain how the Monetary Policy Committee impact the
inflation rate.
The committee which is obliged for deciding the rate of interest for the banking
institution is known as Monetary Policy committee of the nation. It also indicates the
correct set of action which should be occur in monetary policy and identifying the path that
will assure the future growth of the country. The duty of monetary policy committee in
context of the inflation rate of the country is that they make the framework of repo rate
which is useful in conquering the aim of inflation target. MPC is formed with the
involvement of a governor, deputy governor who will be selected from the rest of the
members of boards and there is one other person who is chosen by the joint decree on the
reference of the governor (Speckesser, Carreras,and Sala, 2019). The monetary policy
committee sets all their inflation target in agreement of the laws and regulation CBRT. It
has been seen that if MPC offers any kind of upsurge in the rates of the bank then it may
lead to the growth of inflation in the economy. The major influence in the inflation target of
the economy is the result of intervention by the monetary policy committee.
2. What can government do to promote economic growth? Use examples to
illustrate your point.
The government of any country is solely responsible or liable for development and
growth of the nation’s economy. By promoting the idea of more production in the country
will be the only way through which economic growth could be ensured by the government
as gross domestic product itself indicates the condition of the economy. Wide range of
discussion has been conducted by the professionals and government leaders to ascertain
the growth of the nation, every one gives their own views and thoughts on the same topic
(Popkova, Popova, and Sergi, 2018). But the ruling government is the one who has the
authority by which the right set of policies can be generated for the betterment of the
country. In exception of all this, by providing the enough quantity of funds which is needed
by those people or youth to start their own business is the beneficial way to encourage the
concept of entrepreneurship in the nation. With the right utilization of resources and other
tools government can support the economic at the best level. Other things such as
decision-making criteria for the allocate the right interest that will be suitable for the
general public as well as the overall functioning of the government can support the activity
economic growth.
2 of 8

3. Discuss the three main supply- side policies that the government can use to
reduce the unemployment.
With the generation of unemployment in the nation, UK government is planning to
implement different types of strategy that will lead to the low-level unemployment in the
nation.
 Skill development programs- From last two to four years, government is
continuously introducing the skill and training development campaigns which will
ensure the better growth of the current youth and also help in generating their focus
towards their own career (Kvĕtoň, Bĕlohradský, and Blažek, 2020). Different types
of career counselling programs which are launched by the educational institution
with the help of the government will guide the students to pursue the right direction
by which they are able to get the standard quality of life.
 Training campaigns for unemployed- But it is not enough to give the support only
to the employed or college students, government should be responsible for all those
youth who are not able to find the right job opportunity. The reason could be
unavailability of finance to enrol themselves in such programs, in order to tackle
these situation government can issue the free skilled and employment generation
program.
 Optimum information of job opportunities- Furthermore, by offering timely and
relevant information about the job opportunities in the nation, along with proper
details through which an individual can apply for the particular job will also assist in
eliminating the problem of unemployment.
4. Briefly explain the different types of unemployment and the methods used to
measure them.
The situation of unemployment generally occurs when the individuals are not able to
find the right job role due to several reasons. It may indicate the poor health of the
economy and which needs to be resolved by identifying the key issues.
 Frictional unemployment- It is very usual situation that if the person is planning to
leave their current job and wants to go for other one, then it may take some time. It
is considered as the problem of frictional situation, which is not do much issue
because it happens for a definite period.
3 of 8

 Structural unemployment- Inefficiency of the labour to know about the changes
which have been occurred in the production technology of the company, may result
in such type unemployment in the nation (Harison, 2022).. Business organisation
focuses on substituting their old and less skilled employees with the professional
ones.
 Cyclical unemployment- Increase in the number of job loss and unemployed
people due to the fluctuation of economic structure does happen in this type of
condition. For example, recessionary period in which consumers generally buy less
product and services and can affect the production facility of the business which
leads to several jobless people.
 Voluntary unemployment- It is the occur on the choice of the person, like when
they are not able achieve the employment facility that will suits their requirements or
needs. In such period of time, individual take his own time and wait for the right
opportunity along with working on their personal or professional skills.
In order to get the sufficient number of unemployed people in the country, numerous
measuring tools has been utilised by the government such as surveys to examining the
overall number of unemployed youth and finding out the time period in which they remain
jobless. In United Kingdom, government focused on identifying this data with the help of
unemployment insurance scheme. With this they also operated in discovering the right
reason which creating such unhealthy situation in the nation. And apply correct measure to
overcome these issues so as to ensure the growth of the overall economic framework.
5. Identify and describe the four stages of ‘Economic Cycle’.
Changes in the economy of the country between the period of growth and recession is
termed as economic cycle. This is necessary for those economists or professional who are
continuously working in predicting the instructions for the growth. Economic cycles
regulated in the four distinct phase which are mentioned below-
 The phase of expansion- The process of by which a country can increase the
business activities and profitable working in the nation, by which overall growth is
being observed in the given period of timeline.
 Peak point- It is that phase where a nation will reach to the scope of high growth,
but on the other hand this will also give rise to several distinct issues in the
economy of the country too (Driffill, 2018)
 Contraction stage- The procedure after the peak is the development step, where
utilization of such plans that enhance the general economic growth in the nation.
4 of 8

 Trough- The lowermost phase is that where the activity of the growth is reduced
and decision regarding the GDP and other framework will be formulated in this.
Section B
1. Explain how an economy can achieve sustainable economic growth and
analyze the different methods of measuring economic growth.
It is the responsibility of the government to identify the ways through which they can
secure the surrounding and the natural environment of the country. The main objective for
which the economic growth must be align with the idea of sustainability as it will help in
finding out the innovative ways through which central authorities focus on the improvement
of the economic element by considering the welfare of environment. By utilizing the
concept of sustainable economic growth, government will work in preserving different
natural resources for example land, labor, minerals and capital so that they can be
maintain for the longer period of time and for the future generation too (Chen, Singh, and
Aru, 2020).
To analyze and for the measurement how effective government is operating towards the
sustainable economic growth is the real gross domestic product and for this some tactics
are being used by the central government. With proper examination and evaluation of the
annual GDP rate of the country which is being modified in the different quarters,
government can explore the dominant growth of the economy in the country. It will help in
making out the right set of rules through which authorities which are involved in controlling
the economic functioning of the countries. Along with this government can take the help of
last year GDP growth which could be compare with the current rate and if there is some
kind of issue or reduction then a proper strategical approach must be applied. The last
method through which government can amount of development in respect to the economy
is the average of total growth which has been experienced by the nation in last few years.
Sustainable economic growth can be analysed by the evaluation and availability of natural
resources that are supposed to be used by the government of the country to work on
building different infrastructure (Tichbourne, 2018)
.
5 of 8

2. Monopoly and perfect competition are two market structure at the opposite
end of the two spectrums. Compare and contrast the two structures to
influence our view of which structure is most desirable.
When there is single seller for some product and services in the market, then it is
known as the monopoly structure. In this type of framework, no other competitors are
present who can challenge the monopolist regard the product they are offering in the
market. It is quite difficult for the new entrants to start their own business as certain types
of constraint who will stop them. These could be related to the formulation of some policies
which may consider distinct aspects such as economical, legal or social. In addition to this,
consumers are also the main reason due to which monopolist have enough advantages to
control the market, as they are like to purchase the product from the best companies only.
If there is another business who wants to offer the same product then consumers will find it
hard to accept the. Apart from this the cost of establishment for the business in this
monopoly framework is relatively high form other type of market. This will also resist their
efforts towards the planning to compete the monopolist in the monopoly market. The
decision regarding the price will completely exist in the hand of one and only one seller, he
can increase and decrease the value of the product and services according to his own will.
The next market which is denoted as the perfect competition and the meaning of could
be understandable with the help of the name itself. The market place where all the sellers
are giving equal range of competition to each other as they are following the same pricing
scale. No one in this market can change the price of the product as they are already
running on the minimum profit earning and if there is some kind of reduction in the price
then the situation of loss will be arisen (BUTOV, and BUDNIKOVA, 2022). And if there is
growth in the value then consumers have the opportunity to switch towards another seller
in the market. So, it is important for them to stay at that price which is currently prevailing
in the perfect competition. In addition to this, it is easy get the entry for the new business
due to low establishment cost, and if anyone wants to take exit from the market then it can
occur at any time. Speaking about the structure and quality of the product, then the
product are least differentiated attributes as they are of homogenous in nature.
From these two-market structure perfect competition is the best as there are mass
number of varieties are available for the consumers. They can choose any product and
services in very affordable price. In this, customers have abundant amount of information
about the goods and services which are offered to them by the sellers. By this there is no
unwanted pricing strategy and values from the vendors side, in respect to achieve the
profit.
6 of 8

7 of 8

Reference List
BUTOV, A.A. and BUDNIKOVA, A.S., 2022. FEATURES AND SIGNS OF THE
MONOPOLISTIC COMPETITION MARKET. In Школа молодых новаторов (pp.
13-14).
Chen, H., Singh, B. and Aru, W.S., 2020. Relationship between government expenditure
and economic growth: evidence from Vanuatu. Journal of the Asia Pacific Economy,
pp.1-20.
Driffill, E.J., 2018. Can Stabilization Policy Increase the Equilibrium Unemployment Rate?.
In Recent advances in labour economics (pp. 110-124). Routledge.
Harison, E., 2022. In Search of a Remedy for Disruptions: Assessing the Effects of
Inflationary Pressures on Supply Chains During the COVID-19 Era. In Managing
Inflation and Supply Chain Disruptions in the Global Economy (pp. 1-9). IGI Global.
Kvĕtoň, V., Bĕlohradský, A. and Blažek, J., 2020. The variegated role of proximities in
acquisitions by domestic and international companies in different phases of
economic cycles. Papers in Regional Science, 99(3), pp.583-602.
Popkova, E.G., Popova, E.V. and Sergi, B.S., 2018. Clusters and innovational networks
toward sustainable growth. In Exploring the future of Russia’s economy and
markets. Emerald Publishing Limited.
Speckesser, S.S., Carreras, F.J.G. and Sala, L.K., 2019. Active labour market policies for
young people and youth unemployment: An analysis based on aggregate
data. International journal of manpower.
Tichbourne, E., 2018. Monopolistic Behaviour and the Good Society; An Empirical
Analysis of Monopoly Power and Social Good. An Empirical Analysis of Monopoly
Power and Social Good (April 26, 2018).
8 of 8