Economic Problems of Scarcity and Demand Allocation in Economy : Report

BUSINESS ECONOMICS

Table of Contents
INTRODUCTION...........................................................................................................................1
SUMMARY OF UK ECONOMY...................................................................................................1
TASK 1............................................................................................................................................1
1.1- Explaining the economic problem of scarcity and demand resource allocation in
managing an economy. ...............................................................................................................1
1.2- Discussing the role of supply and demand in an economy and explaining how equilibrium
in the market is achieved. ...........................................................................................................2
1.3- Evaluating the importance of differing market systems in general and evaluating the role
of opportunity costs in determining process of making economic decisions. ............................2
1.4- Explaining what is meant by elasticity of demand and assessing the importance of
elasticity in market interactions. ................................................................................................3
TASK 2............................................................................................................................................3
2.1- Explaining the implication of pricing and corporate objectives on the operations of
company. ....................................................................................................................................3
2.2- Comparing how prices can be set in different market structures and analysing how the
market structure and operational decisions affect the behaviour of the organisation.................4
2.3- Evaluating how UK regulations affect the market power of the cited company. ...............5
TASK 3............................................................................................................................................5
3.1- Analysing how the structure of the UK economy has changed in the 21st century and its
effect on the business environment of the company...................................................................5
3.2- Evaluating the tools which are available to meet macroeconomic policy and its effect on
the organisation...........................................................................................................................6
3.3- Evaluating the performance of the UK economy in the global market and the impact of
economic performance on the business. .....................................................................................6
TASK 4............................................................................................................................................7
4.1- Demonstrating the theory of comparative advantage and justifying the advantages and
disadvantages of free trade. Affect of globalisation on the organisation....................................7
4.2- Analysing the impact of emerging economies on the developed economies and evaluating
the consequences of the recent shocks on the UK economy. .....................................................7

CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Business economics is factor which shows the different methods and measures to show
the to analyse and evaluate the organisation. It uses many theories which can evaluate the
economy of company. Business economics is the lifeblood for a wide organisation like Marks
and Spencer. It helps them to analyse the economic conditions in the better manner. This report
includes about the various economic problems of scarcity and demand resource allocation in
managing an economy. Supply and demand plays a very important role in the economy.
Importance of different market systems and role of opportunity cost are evaluated. Elasticity of
demand and importance of elasticity in market interactions are explained (Buckley, 2016).
Pricing is the factor which has many implications on the business operations. There are some
substantial activities which affect the performance of the organisation. Emerging economies also
have some impact on the development of economy and the company.
SUMMARY OF UK ECONOMY
Currently the economy of the UK is decreasing, but in the past years it has grown very
much. It was expected that after the Brexit economy will be decreased but it has increased
unexpectedly. Brexit is the term for exit of UK from the EU. Economy of the UK has grown very
much. This was possible because of the working of the number of organisations. They helped in
making the economy stable and made it grow on the global level. It has grown 2.2% in the past
years. But is the present stage it is expected that economy will decrease in the future years.
TASK 1
1.1- Explaining the economic problem of scarcity and demand resource allocation in managing
an economy.
Resources are the lifeblood for an organisation to make its production process go
smoothly. That's why resources are known as the factors of the production. It is very important to
allocate the resources in better way because they are very scarce. It became scarce because needs
of the consumer never ends. Demand of the resources among the companies is very high. It
creates many problems in managing the economy. In the current economic condition of UK is
decreasing in this situation it will be difficult for the Marks and Spencer to allocate the resources.
Scarcity of the resources is the very big problem because it makes difficult for the company to
manage the uncertain economic conditions in the market (Williams, 2015). This issue makes
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