Business Management and MacroEconomic Policy

Business Management and Macro-
Economic Policy
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Contents
Introduction......................................................................................................................................3
General economic concerns.............................................................................................................3
Monitory Policy...............................................................................................................................7
Fiscal Policy.....................................................................................................................................9
Capital markets..............................................................................................................................11
Conclusion.....................................................................................................................................13
REFERENCES..............................................................................................................................14
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Introduction
The study covers multiple aspects of Macro-Economic Policy with regard to UK through
different topics like general economic concerns, fiscal policies, monetary policies, capital market
etc. The term economic concern refers to the difficulty in making decisions that arises from a
lack of capital. It happens because individuals have limitless wishes but insufficient means to
fulfil them. As a result, meeting all human requirements with scarce resources is complex. The
demand dimension of economic policies is monetary policy, which refers to the measures taken
by a country 's central/prime bank to manage money supplies and accomplish macroeconomic
targets that foster long-term economic development (Goos, 2018). The usage of government
expenditures and tax initiatives to control economic conditions, particularly macroeconomic
conditions such as overall demand towards goods and services wages, inflation as well
as economic development, is referred to as fiscal policy. The term "financial markets" refers to
the exchange of deposits and acquisitions between capital supplies and people in demand of
capital.
General economic concerns
One of the major issues confronting UK’s economy at current is slow economic development
with demand falling below its prior trend levels. The lost production is attributable to
lower productivity growth and poor demand, as seen in the graph below.
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Low economic development has a negative impact on a variety of economic concerns:
 A decrease in average incomes. Real incomes have fallen and living conditions have
fallen as a result of relatively slow economic development.
 The government debt-to-GDP ratio has risen. It becomes even more challenging
for government to decrease the obligation of government debts to GDP while GDP
growth is slow. The debt-to-GDP level is expected to rise after austerity measures (Gegg
and Wells, 2019).
Government policies and their impact on the business environment:
The position that government assigns to state in economy is an important aspect of government
economics policy Around 1945 to 1979, government became deeply involved in economy by
establishing state-run industries, most of which were organized as public enterprises However,
beginning in 1979, a period of privatisation began, with companies being sold to private owners
in order to create more sustainable economic climate. The cost of doing business is influenced by
tax policy. A spike of income tax (on corporate profits), for example, has the same impact as a
raise in prices. Businesses would pass several of this taxation on to customers in the form of
increased premiums, so it would have a negative impact on their end result. Environmental taxes
(such as landfill tax) including VAT are two other types of company taxes (value-added tax).
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