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FINANCIAL AND ECONOMIC LITERACY FOR MANAGERS TABLE OF CONTENTS

   

Added on  2019-12-18

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FINANCIAL &ECONOMIC LITERACYFOR MANAGERS

TABLE OF CONTENTSQUESTION 1...................................................................................................................................1a) Impact of globalisation on firms and consumers................................................................1b) Movement of demand curve...............................................................................................1c) Economies of scale as well as diseconomies of scale........................................................2d) Determinates of supply in retail sector...............................................................................3e) Substitute as well as complementary products...................................................................3QUESTION 2...................................................................................................................................4a) Analysing market structure such as imperfect competition...............................................4b) Barriers or obstacles for enter in monopoly business........................................................4c) Analysis of policies such as environmental which are used by governments....................4d) Explaining circular flow of income....................................................................................5e) Concept of unemployment.................................................................................................5QUESTION 3...................................................................................................................................6a) Identification of four basic financial statements................................................................6b) Analysis of financial statements.......................................................................................10c) Analysis of four types of phases in management accounting..........................................12d) Relevant and irrelevant cost.............................................................................................12QUESTION 4.................................................................................................................................12a) Concepts such as risk as well as return............................................................................12b) Capital structure...............................................................................................................13c) Calculation of Amortization schedule..............................................................................14d) Sum of money needs to deposit to Gary..........................................................................14e) Calculation of project.......................................................................................................15REFERENCES..............................................................................................................................16

QUESTION 1a) Impact of globalisation on firms and consumersGlobalisation is that in which the company expand its business from national tointernational market. Further, it affects to the business entity as well as customers in differentway. When the company go for globalisation then level of competition increases by which thefirm impacts in adverse manner. When competition enhance then management has to makestrategies to gain competitive advantage. Moreover, it needs to reduce prices of products andservices and offer differentiate goods compare than rivalry firms (How globalisation affectsbusiness, 2011). In addition to this, the firm has to adopt and follow rules and regulations,structure of another market where it enters by which smooth functioning impacts negatively.The customers affect in positive way because when level of competition increases thenfirm provides differentiate products with better quality at the lower cost to gain competitiveadvantage. Hence, they not need to pay higher prices to buy products which lead to increasepurchasing power of consumers. b) Movement of demand curveDemand curve is prepared on the basis of mainly two factors such as prices of productsand services as well as quality demanded. Higher the level of demand lead to decrease sellingprices of products and services in the market. On the other hand side, if demand of goods andservices reduces in the market then it indirectly impacts the pricing level (Behrman and et.al.,2012). Demand curve shifts or moves in both the directions such as right and left which areshown with below diagram:1

From the above diagram, it can be analysed that if level of quantity demanded increasesthen prices reduce which shifts the demand curve right side. Further, as demand reduces priceincreases by which demand curve shifts towards the left side.c) Economies of scale as well as diseconomies of scaleBoth the concepts are very important for a business entity which is described with thehelp of diagram given below:Economies of scale: The situation at which production level increases and average costsor expenses reduces is known as the economies of scale. The firms try to achieve such criteria in2

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