Understanding Communicable and Non-Communicable Diseases

This assignment requires students to explain the concepts of communicable and non-communicable diseases. It delves into their characteristics, how they are transmitted (or not), and provides examples of each type. The focus is on understanding the fundamental distinctions between these two broad categories of diseases.

Business Economics
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TABLE OF CONTENTS
INTRODUCTION................................................................................................................................3
MAIN BODY.......................................................................................................................................3
Micro and macro economic theory and its impacts.........................................................................3
Changes in UK economy through these theories and its impacts....................................................4
Expectations from Central Bank of England...................................................................................6
CONCLUSION....................................................................................................................................7
REFERENCES.....................................................................................................................................8
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INTRODUCTION
Business economics comprises of an economic theory and quantitative measures which help in
identifying various important operations and aspects of company. The aspects which can contribute in
the expansion of organization include capital, labour and product markets (Hill, Cronk and
Wickramasekera, 2013). For conducting the present research, business economy of UK has been
chosen. This report constitutes two theories which are micro and macro economics with their impacts.
Furthermore, it also discusses about the changes in UK economy which occur due to implementation of
these theories. In addition to this, the report also evaluates the expectations from Central Bank of
England.
MAIN BODY
Micro and macro economic theory and its impact
Micro economic theory and its impact
Microeconomics can be referred as economic analysis which influences the behaviour of
particular product, person or a business firm. Microeconomics is a process which helps company in
such a way that it is able to reach at the equilibrium stage. There are various laws and principles which
help in analyzing the marginal analysis. One of the theories of microeconomics is “Theory of Product
Pricing”. This theory comprises of two concepts that are theory of consumer behaviour and production
and cost theory (Liedholm and Mead, 2013). This theory explains about the demand and supply in the
business environment that needs to be assessed by the firm. Along with that, theory evaluates the
business environment through product pricing strategies. It also helps in allocating resources for the
production so that they can maximize their profits as well as minimize cost of the firm. In addition to
this, it also explains different market situations which help in determining the product pricing strategy
of products and services.
Company uses different pricing strategies to sell their merchandise which will give them higher
profits. This strategy helps in analyzing their present and loyal customers associated with the
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organization. Theory explains that if company will know about the needs, tastes, preferences and
requirements of customers and try to meet their expectations, then, this will increase the profitability as
well as effectiveness of products (Chetty and et.al., 2012). Additional revenue which is obtained from
the existing products of company further helps in improving its production process.. The pricing
strategy which this theory follows is variable pricing strategy that constitutes the total cost of variable
characteristics which are related to the production. These characteristics comprises of interest rates and
various aspects of production. Variable pricing strategy enables the product’s prices to have a balance
between sales volume and income per unit sold.
Macro economic theory and its impacts
Macroeconomics can be defined as the process which analyzes the ways in which aggregate
economy behaves. It also covers different phenomena such as growth rate, GDP, inflation etc. It is the
study of whole economic system which comprises of total production, consumption, savings and
investment. There are various theories and models which assesses the economic issues and problems
which are affecting the economy. The theory which is chosen for macroeconomics is “Theory of
Prices”. This theory constitutes various aspects such as inflation, deflation and reflation. Theory of
price is an economic theory which evaluates that the price for any specific product and service is the
relationship between power of supply and demand (Boulouta and Pitelis, 2014). Theory of price helps
in setting optimal market price for the goods and services. Inflation affects all the economies of the
world and thus, there is a rapid increase in the price level. Inflation can affect the economy in a
positive as well as in a negative way. Deflation is opposite of the inflation because it is the
contradiction of purchasing power which declines the price level. With the motive to monitor inflation,
reflation is effective where prices of commodities decrease.
Changes in UK economy through these theories and its impacts
Changes in UK economy related to the interest rates have affected the British economy over the
past 7 years. According to the economists, Selvaraj (2015) explains that the economy crisis will
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influence the entire service sector (Selvaraj, 2015). As per the survey, economic crisis and vast
competitive market is affecting the UK economy. Some economists have stated that the idea of interest
rates has been slow down to zero which is affecting the business in a positive way and helping out in
the recession period. As per the views of Roberts and et.al., (2014), they suggested that manufacturer’s
market can take advantages from low interest rates. This is because it helps in developing business
activity (Roberts and et.al., 2014). Low interest rate is beneficial for companies which will help in
taking the loans and in expanding the market share. UK companies stated that rising level of global
economic crisis has resulted into delays in the new orders that are placed by the clients. This has a
negative impact on the organizations. According to Hughes and Kitson, (2012), they asserted that the
chance of low borrowing costs for long period will be welcomed by mortgage holders but will
disappoint the savers (Hughes and Kitson, 2012).
In contrast to this, when interest rates were cut to 0.5% in March 2009, Mahadeva and Sterne,
(2012) have predicted that interest rates would remain less in the British economy and in the Eurozone
for a long period (Mahadeva and Sterne, 2012). The predictions stated that the interest rates will rise.
But, it remained at zero for several years. This suggests that predictions were not appropriate. Hill,
Cronk and Wickramasekera, (2013) explains that the global economy is showing that low inflation will
gets rise in the upcoming years (Hill, Cronk and Wickramasekera, 2013). If there is low interest rate in
the UK economy then it will set the benchmark for mortgages, overdrafts and loans. Low interest rates
have reduced the relative cost of interest payments on the UK government debt. Boulouta and Pitelis,
(2014) concluded that public sector debt has risen significantly in the past six years. This has made the
cost of servicing debt lower that is important for the relative cost of interest payments (Boulouta and
Pitelis, 2014). If there are benefits for the low rates then there are limitations for it as well because of
which many people and old employees are suffering. For example, with low interest rates, people who
are saving money in a bank are gaining lower interest rate. For instance, pensioners who are relying on
interest payments for income will be getting affected from these low interest rates. If inflation is higher
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than nominal interest rates then it will give a negative impact to the savers in the real value. During
recession period, savers are highly getting affected by low interest rates as well as through high
inflation.
Expectations from Central Bank of England
The interest rate is constantly same from last 7 years that is 0.5% so; the figures will reassure
Bank of England policy makers that they can keep borrowing costs low without fearing a rapid pick-up
in inflation. One of the main expectations is that repo rate introduced by the banking authorities must
be low as decrease in this rate directly affects the working practices of business enterprise in the
market (Allard and et.al., 2013). Further, in case if any organization is planning to expand its
operations in the market and if direct support is needed from banks then in such case, when repo rate is
high, companies have to pay high interest on the bank loan. So, this would directly has an unfavourable
impact on the entire organization as overall cost would increase and in turn profit margin will decline
when specific amount is taken from the bank as a loan. Apart from this, it also influences the growth of
business in the market. With the help of this information, it can be stated that central bank has to lower
down the repo rate so that organizations can be easily benefited with the help of this.
On the other hand, large number of businesses expects that central bank may decrease the tax
rates and this benefits the operations of business as profit margin increases. Apart from this, decline in
taxation rates adversely affects the income level of government as they receive lesser income from
companies. Overall decrease in the interest and repo rate has an unfavourable impact on companies and
businesses (Neuenkirch, 2012). Apart from this, alteration in the rate of interest can encourage the
firms to allocate more funds in the nation which is a kind of development. So, these kinds of changes
can be easily made by central bank with the motive of economic development. Moreover, firms are
also demanding that central bank should focus on the equity market as this will be directly beneficial
for the investors in market. New investment plans can be introduced through which higher returns can
be obtained easily and through this, requirement of the investors can be satisfied effectually.
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CONCLUSION
The entire study being carried out has supported in understanding about macro and micro
economic policies which influences the entire nation. Further, interest rates are the most crucial in case
of businesses where higher rates prevent from obtaining loan from banks and vice versa. Therefore, it
is necessary for banking authorities to control the interest rates for the benefit of entire nation.
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REFERENCES
Journals and Books
Hill, C. W., Cronk, T. and Wickramasekera, R., 2013. Global business today. McGraw-Hill Education.
Liedholm, C. E. and Mead, D. C., 2013. Small enterprises and economic development: the dynamics of
micro and small enterprises. Routledge.
Boulouta, I. and Pitelis, C. N., 2014. Who needs CSR? The impact of corporate social responsibility on
national competitiveness. Journal of Business Ethics. 119(3). pp.349-364.
Chetty, R. and et.al., 2012. Does indivisible labour explain the difference between micro and macro
elasticities? A meta-analysis of extensive margin elasticities. In NBER Macroeconomics Annual
2012. 27. pp. 1-56.
Selvaraj, S., 2015. The Euro Zone Debt Crisis and its Implications for the Global Economy. Journal of
international Economics. 6(1). p.4.
Roberts, B. and et.al., 2014. The impact on the US economy of changes in wait times at ports of entry.
Transport Policy. 35. pp.162-175.
Hughes, A. and Kitson, M., 2012. Pathways to impact and the strategic role of universities: new
evidence on the breadth and depth of university knowledge exchange in the UK and the factors
constraining its development. Cambridge Journal of Economics. 36(3). pp.723-750.
Mahadeva, L. and Sterne, G. eds., 2012. Monetary policy frameworks in a global context. Routledge.
Allard, J. and et.al., 2013. Central bank communication on fiscal policy. European Journal of Political
Economy. 30. pp.1-14.
Neuenkirch, M., 2012. Managing financial market expectations: the role of central bank transparency
and central bank communication. European Journal of Political Economy. 28(1). pp.1-13.
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