Business Economics Report - Doc

Added on - 21 Jul 2020

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Business Economics1
TABLE OF CONTENTSINTRODUCTION...........................................................................................................................4TASK 1............................................................................................................................................41.1 Explaining the economic problem of scarcity and demand resource allocation in managingUK economy using British Airlines.......................................................................................41.2 Discussing the role of supply and demand in UK and how equilibrium in the marketachieved..................................................................................................................................51.3 Evaluating the importance of differing market system and evaluating the role ofopportunity costs in economic decision on British Airlines...................................................61.4 Explaining elasticity of demand and assess the importance of elasticity in marketinteraction in British Airlines.................................................................................................7M1 Explaining economic problem of scarcity and demand resource allocation in UK.........8M2 Theories and techniques in evaluating different market systems and how they affectBritish Airlines.......................................................................................................................8TASK 2............................................................................................................................................82.1 Explaining the implication of pricing and objective on British Airlines..........................82.2 Comparing how price are set in different market structures............................................9M3 Methods for implication of pricing strategies on British Airways................................11D1 Justification on how regulations in UK affect market power and British Airways........11TASK 3..........................................................................................................................................113.1 Analysing the changes in UK economy in 21st century and its impact over British airlines..............................................................................................................................................113.2 Evaluating the tools available to meet macroeconomic policies and achieving theobjectives of British Airlines................................................................................................123.3 Analysing the performance of UK economy in context with global market..................12D2 Impacts of UK economy over Free trade:......................................................................13TASK 4..........................................................................................................................................134.1 Evaluating the theory of comparative advantages and merits and demerits of free trade134.2 Analyzing the impacts of emerging economy on developed economies.......................14D3 impact of emerging economics over developed economies...........................................142
CONCLUSION..............................................................................................................................14REFERENCES..............................................................................................................................163
INTRODUCTIONUK is highly developed; mainly market oriented and is the fifth largest economy in theworld on the bases on gross domestic product and it comprises 3.9% of worlds total GDP. Theeconomy of UK in the year 2016 was the 10thlargest exporter in the world and 5thlargestimporter in world. The whole economy is totally service sector dominated with about 80%contribution in the GDP. London is the world capital of foreign exchange trading with about41% share of foreign exchange global turnover i.e. $5.3 trillion per day. The present report isbased on British Airlines which is the largest airline in UK based on the fleet size. It was createdin 1974 after the British Airways Board was founded by British government. All the economicconditions of UK’s economy will be effecting the operations of British Airways and the role ofdemand and supply in UK and how the prices are set by the company.TASK 11.1 Explaining the economic problem of scarcity and demand resource allocation in managingUK economy using British Airlines.Problem or scarcity of resource is the basic problems faced by the world economies intoday’s scenario where there a limited resource available in the country but society havingunlimited wants. The said resources are mainly divided into three factors like the land, labourand capital which are at all the times not enough to fulfil the need of all the people who are livingor migrating in the economical boundary of UK (Naudé, 2013). Demand of the product is theability and willingness of an individual to buy and use the product which is made available in themarket.Resource allocation is the problem of what to produce, how to produce and in whatquantity to produce. Which include the allocation of scare or limited resources in the relation tothe total output in the economy of UK. The economy of UK will certainly be producing thatproduct with the available scare resources which is giving the priority to the economy which isthe production of consumer goods. Like if UK has to produce both capital goods and consumergoods with the given resource i.e. land, labour and capital then it will choose that combinationsof the product which is giving the maximum total output to the economy (Mollick, 2013). Thebasic economic problem of scarcity in the economy of UK is resources are that there are4
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