Macroeconomic Policies and Their Impact on Business Environment

This presentation discusses the impact of macroeconomic policies on the business environment, including government policies, labor markets, monetary and fiscal policies, and capital markets.

PRESENTATION

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Business management is the field of having responsibilities that includes managing the
administrative tasks associated with business. It includes the operations conducted in company
along with assisting its employees to reach at the top in their productivity levels. It manages the
coordination of employees working within the company. Business management systems helps in
providing a foundation for making business decisions while considering current processes,
activities and goals of the organisation. The macro- economical policy within business
management are actions taken from the side of government for the purpose of having a positive
impact on country's economy. It sets targets that will focus on the specific economical needs.
This focus on the performance of country economy along with the changes in the same. There is
a detailed analysis of the general concerns associated with the business environment. There are
different types of policies that will be discussed further in the presentation.
MAIN BODY
General economic concerns
Businesses are made to grow for the purpose of generating profits but this growth and
working of business depends on external circumstances such as government policies, employees
and unemployment rate along with many other parameters. It influences the prosperity of
company and are important to be taken into consideration while preparing for the business
development strategy. Government policies are implemented to draw changes within the
behaviours of business environment. It includes setting up higher rates, rise in the price rate will
decrease customer spending, while in the case where the policies are about lowering the interest
rates, it will assist in increasing the business production. Higher rates will lead to decrease the
product consumption.
Labour markets are flexible and thus, creates issues for the employment purpose for the business
of the company. Labour markets are related with the interaction between supply, the workers that
are available for work and demand, regarding the jobs that are available within the company. It is
responsible for setting the wage rate for workers. Labour markets supports the rights of labours
that includes, minimum wage, safety policies within organisation and so on. This affects the
business due to the flexibility present in this market while influencing the decision made within

business. Business will be able to attract the best talents when offering works high salary and
desired workplace culture.
Monetary policy
By definition, Monetary policy is macroeconomic policy that is laid down by the central bank of
the country. It includes managing money along with the supply rate and interest rates. It is the
demand side economic policy that is used by the government of the country to attain the
objectives of the organisation in terms of inflation, consumption, growth and building liquidity
for the company. The supply of money is influenced in terms of interest and inflation rates. This
will impact the expansion of business as cost of debt will be changed along with its relative cost
for consumption.
Demand for money is struck by the uncertainty within the future of business and implication can
be determine from three motives involved within demand of money. While working with the
motivate of making a transaction, and the required money is not available, here, the money will
be demanded. Transaction will increase with the rise in income thus, making demand for the
same increase as well. Precautionary includes some unexpected expenses that requires immediate
cash and non- availability for the same will result in demanding money. Speculation is related
with the rate of return and making opportunity costs. Here, the demand for money is said to be
less risky than the process of lending the same.
Fiscal policy
Fiscal policy is related with the utilisation of government sending during taxation that will
influence the economy. This policy is used by the government to influence various levels
involved within the demand of economy and the efforts that are applied to attain the economic
objectives. These economic objectives includes, price stability, complete employment and
growth within economy. Tax policies within fiscal policies leads to alter the demands of products
and services within market. It includes changing working incentives, savings, as well as lowering

the budget for deficits. These changes affects the amount of revenue involved from the rise of
taxation systems.
Social contributions are important to develop a significant share within government revenue and
reflects the costs involved for doing business. Deficits in business environment are related with
the expenses that are associated with exceeded revenue and liable exceed assets. Budget deficits
are established when public savings are in negative relations. Sustainability of public debts
depends on the fiscal policies that do not consider long- term thought process. This debt is
sustainable when government is successful in meeting all payment obligations related to the
public.
Capital markets
Capital markets are venues associated with funding and exchanging the same between suppliers
for capital and use of the demand money. Primary capital markets are related with issuing new
capitals while secondary deals with the issue of security traded between investors. Primary
capital helps in creating long term instruments that will help in raising funds from the capital
market. It is the equity capital helping in association with financial institutions and banks.
Secondary capital markets are also known as stock market where the small business have the
chance of trading securities. Here, investors will buy and sell the securities that they own.
Crowdfunding is used for the purpose of gathering money for the business from large number of
people. These people will pitch in the money in terms of small investments to provide the
amount required for a small to take- off from ground. Reward based crowdfunding are donations
in return of products and services. Donation based deals with supporting a cause while in the
peer to peer lending system, interest is to be paid on money given.
Crypto currencies are the digital form of money that is created by using the science of hiding
information. It uses digital signatures for keeping the record and transactions safe and making
other understand that the transaction made is real.

CONCLUSION
 It can be concluded that the macro-economical policies affect the business environment
in various contexts.
 Business management is important for the company to stay afloat in their business
operations.
 Economic concerns includes, government policies, labour markets and other parameters.
 There are different types of policies such as monetary and fiscal that has different
functions in terms of economics.
 Capital markets includes various forms of generating capital for the business such as
crowdfunding.

REFERENCES
Books and Journals
Čepel, and et.al., 2018. Business environment quality index in the SME segment. Journal of
Competitiveness.
Cepel, and et.al., 2019. Selected economic factors of the quality of business
environment. Journal of International Studies.
Roman, A., Bilan, I. and Ciumaș, C., 2018. What drives the creation of new businesses? A panel-
data analysis for EU countries. Emerging Markets Finance and Trade, 54(3), pp.508-
536.