Business Management and Macro Economic Policy

This report explores the impact of economic issues and macroeconomic policies on the business environment. It discusses topics such as government policies, monetary policy, fiscal policies, and the role of capital markets. The report also highlights the importance of understanding how financial government regulations can affect the economic climate and the effectiveness of organizations.

Business Management and
Macro Economic Policy

Contents
INTRODUCTION.......................................................................................................................................4
MAIN BODY..............................................................................................................................................4
1. Understanding economic issues and their impact on the business environment...................................4
2. Monetary policy and supply and demand for money and different aspects impact on demand for
money......................................................................................................................................................6
3. Fiscal policies focusing on taxation and macroeconomic effect and other factors...............................8
4. Role of various primary and secondary capital markets.......................................................................9
CONCLUSION.........................................................................................................................................10
REFERENCES..........................................................................................................................................11

INTRODUCTION
Business management is the process of gathering person to achieve a company's desired
aims and objectives. Business management involves coordinating, preparing, managing, hiring or
managing, and guiding a company attempt to achieve the specified objectives of the
organization. The administration's constructed macroeconomic policies for controlling and
regulating business activities also influence the operation of private companies. In addition, the
company's initiatives contribute to significant industrial emissions social costs, and other risks.
The economic climate in which company companies work is highly affected by this. Hence
knowledge as to how the financial government regulations can impact the economic climate is
important in the effectiveness of organizations. This report consists of economic issues like
governmental policies, income distribution impact on the business environment. Understanding
monetary policy, supplying and demand for money. Along with, fiscal policies focus on taxation
that impact on different aspects. Moreover, role of various primary and secondary capital
markets like stock and bond market.
MAIN BODY
1. Understanding economic issues and their impact on the business environment
Economic challenges affecting the world economies, and also cities and rural, involve
growth expectations, unemployment, environment monitoring, inequalities, work stoppages,
emerging economies and the effects of new innovations. Several of the basic economic concepts
in the activity of any society are the economic issue, also named the simple, main, or essential
economic issue. It claims that shortage exists, or that the limited financial resources are essential
to fulfill all customers' needs and wants. The United Kingdom faces various economic issues that
direct impact on the business environment in direct manner such as:
Governmental Policies: Government economic policy, initiatives by which an
administration has tried to control the economy. The government's economy usually affects the
combined strategy of a country, and it is mainly via the expenditure that the country performs its
3 main mechanisms of maintaining control: the allocation of resources role, the consolidation
role, and the decentralized structure. Government agencies may adjust accordingly to the policies
in relation to the economy. Economic governance is often used to design productivity expansion
or to avoid harmful financial implications. It is a big economic issue the face by the UK
government because government policies have a negative effect on the business companies able
to function. As a consequence, they have to make necessary changes to their policies.
Technological alterations: As population grows companies are likely to look for new ways of
surviving on the industry.

Labor markets: The labor market is just where workers and owners meet to negotiate for
jobs and salaries or other benefit packages. The amount of individual that want to work is
determined by the amount of compensation companies give. The pay level enters a balance at the
stage where supply of labor is equivalent to employment levels. The labor market, also known as
the labor market, relates to the supply and labor demand under which the production is provided
by the workers and request by the bosses. It is a critical element of any society, and is closely
associated with money, commodities, and social care worker. Due to shortage of labor face the
problem in economics that impact on the business environment in direct manner. Because when
an organisation wants to labor for the production but this issue impact on the business operations.
Business labor supply and demand is affected by shifts in the bargaining power (Masoomzadeh
and et. al., 2019).
Income distribution: Distribution of income is the lightness or fairness that the profit
amongst individuals in society is treated. When all gain precisely the same amount of funds,
therefore the income distribution is completely the same. Nevertheless, the income inequality of
a nation typically falls or something in the center among the same and the disproportionate.
Income sharing is fundamental to one of the most important international economic problems. At
one side there will be those who claim that certain wages will be the same, or as quick as
possible, and that a primary role of the government should be to transfer money from the musts
to the has-nots. If inequality influences how income countries function growth can be influenced
by, among many other things, their failure to invest in education and their lower rates of safety.
Decrease its requirement for products or services. They could see those accumulating deposits
which lenders could then lend, thereby through investment in the economy. When peoples are
working on same position but did not receive same income so impact on the business
environment because this issue create problem in the economy.
Employment: It is another economic issue that faces by the UK and take right steps to
come out from this. Employment is defined in terms of what you do as a paid work. Working for
a coffee shop is an example of a job. Employment is specified by the number or percentage of
people who have jobs. An illustration of jobs is the number of people with State by System
mentioned paid jobs. Conditions of employment are the obligations and advantages of a job as
decided on this at the time of recruitment by a workers and employers. These typically involve
work duties, working hours, code of conduct, holidays and paid holidays, and set to start pay.
When economy down of the UK that time start problem of recession and most of the people lost
their jobs. It impact on the economy in direct manner. Along with it impact on the business
environment in negative manner and loss their good employees.

2. Monetary policy and supply and demand for money and different aspects impact on demand
for money
Monetary policy on the basis implemented by an economic institution which regulates
either the inflation rate paid on really short-term borrowing or the currency value, often
managing unemployment or rate of interest to maintain stable prices and overall money
confidence. Financial system, the free market of monetary strategy, consists of actions taken by
the government of a country to regulate money supply in the economy to attain macroeconomic
objectives which facilitate economic growth. Monetary policy is the acts and communication of a
federal reserve which manages the money supply. Supply of money access to and correction of
mutual funds from finance, money, payments and the savings account. Money is the most
significant of those types of currency. Credit covers loans, mortgages and securities
(Jankaweekool, Chaiyawat and Sinthupinyo, 2019).
Monetary policy provides income to stimulate production. To avoid unemployment it grows
liquidity. Central banks are using borrowing costs, criteria for bank reserves and the amount of
state securities that banks will retain. All those resources have an effect as to how much lenders
can borrow. Loan amount determines money supply.
Supply and demand for money

Although money demand includes the required keeping of capital instruments, price is the total
volume of cash holdings market at a particular period in a society. Money supply data is reported
and released as this affects price level, inflation, exchange rate, and bond market. The demand
for money in macroeconomics is the required keeping of capital income in the event of capital:
that is to say cash or deposit accounts instead of savings. It may relate to request for cash that is
consumed directly as M1 (immediately spent holding company), or in the wider context of M2 or
M3, for cash. The demand for capital relates to the overall wealth owned by both the individual
and enterprises. There are many things that influenced demand for money, including such levels
of income, inflation rates, market prices (inflation), and instability. In based on the three key
arguments for keeping capital, the effect of these variables on money supply is clarified.
The money supply, on the date calculated, is all the currencies and other reflective
process in the country's economy. The money supply contains nearly both cash and investments
and it can be used just as effectively as currency. Governments use a variation of their financial
institutions and treasury securities to release bank notes and coin. Banking institutions control
the economy publicly available via the capital keeping conditions imposed on banks, whether to
expand liquidity and other regulations.
There are different aspects that impact on the demand for money such as:
Interest rate: The interest rate is the rate from which a purchaser (debt collector) charges interest
about the using of the capital they raise from a provider (issuer). It's seen as the lending capital
"price." Objectives for lending rates are an instrument of fiscal policy. The quantity of funds that
is being sought differs inverse proportion with the rate of interest. For nations, financial
institutions prefer to lower interest rates as they want to raise economic activity and demand.
Lesser interest rates, nevertheless, may cause an economic environment in which substantial
quantities of expenditure are produced but lead to large outstanding taxes and economic
recession (Ramanadham, 2019).
Consumer spending: This probably relates to the fourth element, "The market for products is on
the rise." Users also invest in other sources of assets including such equities and bonds
throughout periods of increased aggregate demand, including the months proceeding Christmas,
and trade them for property. They need resources to buy products and services, including
Christmas gifts. And even if the buyers spending expenditure rises, then the demand for capital
will rise.
Precautionary motives: When individuals accept that they might immediately ought to purchase
stuff in the near future (say it's 1999 and they're concerned about Y2 K), they can selling
government bonds and keep onto credit, and the money supply will just go up. When
individual seem to think that there would be a chance to buy a resource throughout the coming
years at a really cheap price, they would also choose to keep capital.

Change in the general level of price: When have recession, commodities will be more costly and
supply of money will grow. Incidentally more, the amount of holdings of capital continues to
continue to increase as the rates. And although the theoretical supply of money is rising, the
actual demand remains exactly same in.
3. Fiscal policies focusing on taxation and macroeconomic effect and other factors
Fiscal policy defines to the utilization of government expenditure regulations to control
economic circumstances, which include cumulative growth in the economy, wages, relationship
between financial developments. It is utilizing of monetary and fiscal policies to affect the
project are fiscal policy. Once the state determines on the products and facilities it imports, the
dividend payments it allocates, or the taxes it raises, it is active in fiscal policy. Specific
team experience the main economic effect of any shift in the state budget – a flat tax, for
instance, for parents with kids, increases their disposable income (Girella, Tizzano and Ferrari,
2019).
Taxation: Fiscal policy discusses the administration's revenue and financial choices.
Monetary policy relates to the economic production of capital and interest rates. These are the
primary strategic strategies that monetary employees display to navigate wide financial
implications. Consequently, fiscal policy would be to use deficit spending, taxes, and transfer
payments to control economic activity. Fiscal authorities utilize expansionary policies whenever
the country is undergoing a downturn by rising public expenditure, reducing taxes or growing
government subsidies.
Macro-economic effects: Federal policy has microeconomic consequences when the variables
and opportunities for personal economic choices are altered. Such reforms come in many ways
like tax policies , economic policies , rules, taxes, incentives, price controls, licenses, and (to
mention a few) public-private partnerships. Such strategies distort the risks and advantages of
almost every aspect of everyday life that different people encounter.
Social security contribution: Contributions to social security are mandatory costs incurred to the
national budget which grant eligibility to a (dependent) potential economic good. These include:
employment compensation and replacements, accident, death and illness coverage, old-age,
disabilities and survivors' pensions, community payments, reimbursements for health and
hospital costs or availability of medication or emergency care. Contributions can be charged for
workers as well as workers. Such costs are typically allocated for social benefits, and often are
compensated to particular government agencies that can provide those very advantages.
Pension: The enhanced budget shortfall resulting from the deregulation of a public pension
scheme doesn't really indicate a stress relief of the fiscal policy viewpoint. The influence of the
change on distribution contracts and national savings depends mainly itself on effects mostly on
amount of explicit and implied government debt as well as on the level of income from the pre -
liberalization income tax and the finance industry. The decision making of the restructuring,

even so, also varies depending on impacts including the regards among bond yields on
transactional and relational government debt. Circumstances can occur in which privatization of
pensions, if not compensated by fiscal contraction, would loosen the fiscal position (Saritas,
Meissner and Sokolov, 2019).
Benefits: Fiscal policy defines to the utilization of revenue generation and expenditure strategies
by the government to support community income and expenses, and inevitably to impact the
country's economy. That legislation can be either expansive or controlling inflation. Although it
can be used helpful to deduct budget deficits, battle joblessness and boost internal demand,
implementation usually takes some time and can cause disputes between targets.
Public expenditure deficit: The disparity within government total costs and public government
expenditure is called a fiscal imbalance. It is an example of the Government 's overall payment
environment. New loans will not be included when measuring the net sales. Government (fiscal)
creates financial to state consumption spending, that is to say the cumulative amount of
scheduled and unplanned spending or a volume of revenue and expenses payroll system from
Budget 2016–17. Therefore, if a world depends a wider fiscal deficit, usually greater than 500%,
it will either raise its tax space by higher taxation, more usually implicit tax levels or reduce its
resulting from increasing, more typically non-expenditure.
Sustainability of public debt: Public debt of a nation is deemed manageable if policy expenditure
limitations can become achieved while interfering with its financial and budgetary policies. It
means that the sum of the government debt will not surpass the current value of all important to
consider the type deficit spending, as the section should explain. This notes that a defined public
debt program can be seen to be manageable unless the fiscal deficit ratio is an important attribute
of the overall debt. This guarantees that every debt- ratio uptrend motion related to false
disruptions is eventually overturned via main deficits.
4. Role of various primary and secondary capital markets
Role of primary and secondary capital market: The main market is where they
produce bonds. It is with this sector, for the first time, that corporations sell shares and bonds to
the market. An introductory publicly offering, or IPO, is a prime-market example. An IPO arises
whenever a commercial corporation first releases inventory to the public. Typically referred to as
the financial sector is secondary market. The shares are first sold to the general public in the
primary market for sale where a business receives capital from the shareholders and the value of
maximum the bonds; then they are listed on the main market for business purpose.
A business may generate cash from the main market via alternative techniques. The
approaches involve controversial subjects, proposal for selling, preferred stock, conservative
issue, and tendering process. This is the most famous long - term capital gains having to raise
form. That means collecting funds from investors indirectly. The financial sector is a country in
which marketable shares of differing financial services and products are frequently obtained to

the community, appropriate to the needs of every person from all income groups. These
economic products can be purchased and auctioned on the capital market, partitioned into the
main vs secondary market. There are 2 separate concepts to this (Panayides, 2019).
Crowd funding: Crowd funding is the use by large numbers of people of limited sums of money
to support a startup company. Make profitable use of such a convenient access thru the social
networking sites and fundraising web pages of various distances of companies to carry around
each other entrepreneurs, with the opportunity to add entrepreneurialism by broadening the
group of capital well beyond conventional triangle of proprietors, family members and
investment bankers. Crowd funding has given innovators the chance to increase thousands of
thousands or even millions of Euros for anybody with capital to spend. Crowd funding is
offering a platform for those with a concept to propose that in front of stakeholders waiting.
Crypto currency: A crypto-currency is a virtual online money protected by cryptographic that
renders counterfeiting or double-spending almost unthinkable. Most crypto currencies are
distributed, block chain-based networks — a shared database operated by a dispersed computer
server. One distinguishing characteristic of bit coins is that they are usually not distributed by
any centralized power, allowing them technically resistant to intervention or abuse by the
authorities.
CONCLUSION
As per the above report it has been concluded that to manage all the business activities
require managing all the economic policies that are related with business. There are focusing on
pricing and demand for money those changes according to different factors like consumer
spending, interest rate and many others. There are identified two capital market that plays
essential role to increase stock and bond market in effective manner. Moreover, understand the
concept of macro economics that related with the fiscal policies and provide effective results.

REFERENCES
Books and Journal
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Enable Supply Chain Risk Management in the Automotive Industry. Journal of Supply
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the case of the business model. Journal of Management and Governance, pp.1-30.
Jankaweekool, P., Chaiyawat, T. and Sinthupinyo, S., 2019. The Empirical Analysis on Supply
Chain Risk Management With Firm Capability Perspective of Thailand Automotive
Industry. International Journal of Mechanical Engineering and Technology. 10(3).
Masoomzadeh, A. and et. al., 2019. Organizational Innovation Factors, Capabilities and
Organizational Performance in Automotive Industry. Montenegrin Journal of
Economics. 15(3). pp.83-100.
Panayides, P. M. ed., 2019. The Routledge Handbook of Maritime Management. Routledge.
Ramanadham, V. V., 2019. Privatisation in the UK. Routledge.
Saritas, O., Meissner, D. and Sokolov, A., 2019. A transition management roadmap for fuel cell
electric vehicles (FCEVs). Journal of the Knowledge Economy. 10(3). pp.1183-1203.
Severino, M. R. and Godinho Filho, M., 2019. POLCA system for supply chain management:
simulation in the automotive industry. Journal of Intelligent Manufacturing. 30(3).
pp.1271-1289.
Online
Demand and supply for money. 2019. [Online]. Available through:
< https://financetrain.com/demand-and-supply-of-money/>
Factors impact on demand for money. 2019. [Online]. Available through:
< https://www.thoughtco.com/demand-for-money-economics-definition-1146301>