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Financial and Economic Literacy for Managers : Report

   

Added on  2020-07-22

16 Pages3773 Words33 Views
FinanceCalculus and Analysis
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Financial and EconomicLiteracy for Managers
Financial and Economic Literacy for Managers : Report_1

TABLE OF CONTENTSINTRODUCTION...........................................................................................................................1Project Questions.............................................................................................................................11. Economic concepts of market structure, small and medium enterprises, multinationalcorporations and growth strategy...........................................................................................12. Business economic concepts and theories of demand, supply and monetary policy of Bankto UK Housing market............................................................................................................43. Discussing macroeconomic indicators and past trend of UK.............................................64. Discussing concept of leverage and current account management for decision-making...75. A) Interpretation of Financial ratios...................................................................................9B) Present value calculation...................................................................................................9C) Capital investment technique..........................................................................................10CONCLUSION..............................................................................................................................11REFERENCES..............................................................................................................................12
Financial and Economic Literacy for Managers : Report_2

INTRODUCTIONEconomic growth is crucial for every country to resolve many problems. Present reportdeals with importance of various business economic concepts and theories to attain growth ofbusiness and thereby benefiting nation as well. UK local high street shop which is situated inMarylebone named The Conron shop is discussed engaged in providing home goods tocustomers. Report also discusses about capital investment technique such as NPV which is quiteeffective one in assessing attractiveness of project in the best possible way. Present valuecalculation is also done in order to provide clarity related to accomplish increased returns in thefuture. Furthermore, financial ratios of Morrisons Plc is computed for 2015 and 2016 to assessfinancial health in effective way. Project Questions1. Economic concepts of market structure, small and medium enterprises, multinationalcorporations and growth strategyMarket structureMarket structure is the place where business compete with another to strengthen theircustomer base in the best possible way. The structure consists of oligopoly, monopolistic firm,perfect competitive market, monopoly etc. In relation to this, economic theories can be explainedsuch as modern theory and neoclassical approach. Various firm try to gain market share byproviding strategies which help them to garner revenue in effective manner.Modern theory is basically concerned with varied macroeconomic elements. Mainly, itconsists of assessing customer preferences and demand, income and employment indicators andpurchasing power of consumers and as such, all these factors affects economic decisions. Highstreet store of UK named The Conron shop situated in Marylebone is also affected by customerbuying behaviour (Zietlow, Hankin, Seidner and O'Brien, 2018). Another one is neoclassicaltheory states that demand and supply of goods are affected by the consumer preferences and assuch, utility is achieved with much ease. This means that customer satisfaction is achieved ifthey attain required utils by paying for the commodities. Small and Medium Enterprises (SME)1
Financial and Economic Literacy for Managers : Report_3

SME's are important part of UK as they help nation in fostering development in the bestpossible way. This means that nation achieves economic growth in effective manner. Moreover,SME also help in increasing GDP (Gross Domestic Product) of UK quite effectually. Withregards to SME, two theories can be discussed such as Theory of Economic change by Nelsonand Winter and Theory of Organisational Equilibrium by Barnard-Simon. Nelson and Winter has laid theory of economic change in the context of SME. The theorydiscusses that business implements well-mannered strategies in order to gain maximum customerbase leading to enhancement in entity's market share (Allgood and Walstad, 2016). This theoryclassifies about competitive moves taken by organisation to achieve desired targets in the bestpossible way. This means that firm try to compete with another to grab market share in effectivemanner. Another theory is given by Barnard-Simon relating to organisational equilibrium. Thistheory applies mainly in SME where number of employees are less and as such, these areintegral part of an organisation in carrying out tasks in the best possible way. Employees aretermed as participants and as such, each and every participants provides contributions andcompany pays for services provided by them. Multinational Corporations (MNC)MNC are big organisations which have enlarged business in locally and internationally.They help nation to enhance economic growth and as such, country is benefited with much ease.In relation to this, theories such as Raymond Vernon's Theory of International Product Cycle andDunning's Theory of Eclectic Paradigm can be explained in effective way. Vernon's Theorystates that there are various stages in product life cycle consisting of introduction, growth phase,maturity and lastly decline. This is the life span of product which goes into the market and assuch, product is influenced by market forces of demand and supply. Thus, goods are moved tointernational destination of business and mainly capital goods are produced in order to satisfyhigh income group of customers in the best possible manner (Finke, Howe and Huston, 2016). Another theory listed in MNC is Dunning's Theory of Eclectic Paradigm. This theorystates that MNC caters to grab funding from FDI (Foreign Direct Investment). This helporganisation to expand its operations with much ease. It is quite useful for company in carryingout tasks and activities in effectual way. More investment is advantageous to business so that itmay be able to achieve efficiency quite easily. 2
Financial and Economic Literacy for Managers : Report_4

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