Contemporary Business Environment

Contemporary Business Environment

Table of Contents
INTRODUCTION-..........................................................................................................................3
MAIN BODY...................................................................................................................................3
1- Using the circular flow of income, explain the main impacts of lock down on the UK’s
economy-......................................................................................................................................3
2- What are the (likely) impacts of the ongoing war in Ukraine on the UK’s economy?
Consider both the short-term and long-term economic impacts..................................................4
3- What economic suggestions if any can be provided to the government of United Kingdom
to remedy any negative impact of war in Ukraine on UK economy?..........................................5
4- Economic recommendations provide to central bank of UK to remedy negative impacts of
war in the Ukraine on economy?.................................................................................................7
CONCLUSION................................................................................................................................9
Recommendations- .....................................................................................................................9
REFERENCES................................................................................................................................1

INTRODUCTION-
Contemporary business environment is vastly related with the natural environment,
cultural environment, political as well as economic environment. It is also known as a modern
business. The current report will base on the lock down impact which have a negative impact on
the UK's economy. UK has a highly increasing cultural market and businesses. It is listed in one
of the most widen economies and have a big financial industry. With the use of the circular flow
of income it will show the main impact of lock down on the UK's economy. It also included the
impacts of the ongoing war in Ukraine on the UK's economy, which consider both long term and
short term economic impacts. Moreover, it includes economic suggestions if any can be provided
to the government of UK to remedy any negative effects of the war in Ukraine on the UK's
economy. Along with the suggestions to the Central bank of UK as well.
MAIN BODY.
1- Using the circular flow of income, explain the main impacts of lock down on the UK’s
economy-
The circular flow of income mean that the perpetual flow of production of the such goods
and services the income and expenditure in an economy. With the help of this it will show the
lock down impacts on the UK's economy. It shows that the lock down reduces the labour supply
and create a negative impact which closes many businesses. The current situation reflected that
lock down also affected the GDP of the UK. It shows with the help of the circular flow of
income (Wardley-Kershaw and Schenk-Hoppé, 2022). There are three approaches which
measures the GDP level of business which include production, income and expenditure.
Jobs at risk- In the time of lock down the main consequences reported is the
employment rates where the jobs were at the risk. The production level in the UK is lower than
compare to before lock down. It is due to the demand of the goods and services are not likely to
be that much which creates the reason for the falling in sales and have a negative impact because
of the closure of such industries. It also reduces the employment productivity and their working
hours because of staying at home. The production process in the many businesses were advanced
in the international economy and with the lower production rate in the supply chain of business.
The UK's economy have a very large financial service industries. Any kind of impact on the
output of financial industries will reflect the change whether it is explicit or implicit.

Income- the lock down creates a positive as well as negative impact on the supply and
demand of such good and services due to the lock down. (Gordon and Recio, 2019). It means
that, it creates a fall in the employment and working hours of them which creates the lower
compensation on the individuals, it counted in specifically in the wages. It has an impact on the
UK's economy which will have an exceptional power to use the lower labour and the another
inputs which is counted in the production process (Inegbedion, 2021). This occurs the reduction
reason which directly impact the Gross Operating Surplus which shows the company's profits
decreases. It also has the lowest income regions which faces many big challenges due to the
Pandemic. It shows that the lower level of areas are more at the risks due to this.
Expenditure- It includes the household consumptions which directly reflects the
unnecessary expenses rates which will be the lower. Due to the COVID-19 and the closure of
some businesses, it creates some limitation on few changes are due to measure on some
unnecessary type of spending by the industries (Pedauga, Sáez and Delgado-Márquez, 2022).
The pandemic have created the impact on the global level of the business which is had a
consequence of their gross trade flows. Whereas, it reflects the lower demands for any kind of
reduction process which shows the reflection on the import volumes of the businesses.
2- What are the (likely) impacts of the ongoing war in Ukraine on the UK’s economy? Consider
both the short-term and long-term economic impacts.
The ongoing war in Ukraine has created an impact on UK's economy because it has some
economic connection to the Ukraine. The international value of such trade is fell down by the
2.8% in between the February and March because of war and creates a negative impact on the
UK's economy (Verschuur, Koks and Hall, 2021). The European Union exports also dropped in
the March by 5.6% and their imports by the 3.4%. In the UK the food price is hit by the 4.3%
which refers to the highest in compare to other country.
There are physical impact on the obstruction and the devastation of the same productive
capacity which have a direct impact on the trade and production activities. As the Russia counted
as big exporter amongst the world which exports the wheat, pig iron and natural gas, it is an
important supplier of the fertilizers. Ukraine is counted as a key trade good of the food industry
which ist include the wheat and sunflower oil (Mardones, 2022). Due to the war the imports of
organic chemicals from European union is decreased by the 1011.62 GBP millions in the month
of May from the 1170.79 Million in the month of April in 2022. As well as the such imports of