Business Management and Macro Economic Policy

BUSINESS MANAGEMENT
AND MACRO ECONOMIC
POLICY

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
Comprehend economic problems.................................................................................................3
Understanding the monetary policy and the supply or demand for the money along with
assessing implication of the different aspect of demand for the money......................................5
Understanding of the fiscal policy emphasizing on the taxation and its macro environment
impacts.........................................................................................................................................7
Role of secondary and primary capital markets...........................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Business management is the action taken by administration for organizing workers to
accomplish desired aims and objectives of business. It comprises managing, leading, planning,
recruiting, controlling and directing a business attempt for reason of accomplishing ventures
listed goals. The current study is based on macroeconomic policy that affects business
performance and practices. This report explains economic problems such as government policies,
income distribution, labor markets and employment and their impact on business environment.
Understanding of monetary policy and supply & demand for money, implications of varied
aspects of demand for money will justified in their report.
Furthermore, in this assignment clarified understanding of fiscal policies focus on
taxation & their macro-economic affects, pensions, social security contribution and benefits. It
also defined comprehend of sustainability of public debt and public expenditure deficits.
Moreover, it clarified role of different primary & secondary capital markets such as bond and
stock markets in raising money for investment.
MAIN BODY
Comprehend economic problems
Economic issues facing the world economy and nations, include prospects for labor
market issues, employment, income distribution and government policies. There are several
economic problems, following below;
Government policies-
It contains purpose things are to be done in some way and why. It leads to development
of protocols and procedures to see that Government is a body of individual that work to
successfully and effectively guide a organization or community. It is a principles or rule that
hopefully better guides decisions, outcome in positive results that affect business. Fiscal policy,
monetary and supply side policy considered as economic issues that impact on business
environment positively or may be negatively (Abdixhiku, Pugh and Hashi, 2018). Local or
national policy can affect interest rates, rises in which maximize amount of borrowing in

business atmosphere. For example, high rates lead to minimize customers spending, it directly
impact on profitability and sales of companies. Changes in business policies governed by
government straightly affect functioning of business organizations. As an outcome, they have to
alter their policies appropriately such as taxation changes. When government make changes in
taxation policies, it impact on business activities such as import and exports as well as purchase
of raw materials.
Labor markets-
It known as job market, refer to demand & supply for individual throughout workers
cater supply and employers demand. This is the main element of UK economy and is intricately
tied in with markets for products, services and capital (Betcherman, 2019). Labor market rigidity
or flexibility refer to employment problems such as worker wages, the ease of which
organizations can recruit and select applicants, power of unions and length of probation periods.
These flexible markets that favor employee’s rights can lead to lower unemployment and
increase labor productivity rather than before. Changes in labor market put negative impact on
business environment as it decrease profit margin and put pressure on management to make
major modification in employment procedure according to current needs of this market. It affect
negatively because flexibility in labor market allow workers to demand wages according to their
needs that impact negatively on salary structure of companies. Furthermore, It can be said that
flexible labor markets are recognized by things such as low minimum wage and legislations that
do not impede recruiting or termination of workers.
Income distribution-
In economies, it is how a country’s total gross development profit amongst their
population. Income and their distribution have always been a main concern of economic policy
(Ridzuan and et.al., 2017). Income distribution within society is represented by Lorenz curve, as
it directly impact on business environment positively when distribution is based on equality, on
the other hand it affect negatively when distribute of income is unequal. Increase in income
outcomes in demanding more products or services, thus spending more money. On the other
side, decrease in income results in exact opposite. In simple words, when incomes are lower, less
spending happen and business are impact by it. When income distribution is fair and equal, it