Business Economics Report: UK Market, Marriott Hotel Analysis

This business economics report delves into key concepts such as scarcity, demand, and resource allocation within the context of the UK market, using the Marriott Hotel as a case study. It examines the roles of supply and demand in establishing market equilibrium, analyzes the significance of different market systems including perfect competition, monopoly, and oligopoly, and explores the impact of opportunity costs. The report further investigates pricing strategies, corporate objectives, and the implications of various market structures on operational decisions. It assesses the performance of the UK economy, considering macroeconomic indicators like GDP growth, inflation, and unemployment, and evaluates the influence of these factors on the selected business unit. Furthermore, the report analyzes the theory of comparative advantages, the advantages and disadvantages of free trade, and the impact of emerging economies and recent economic events. The conclusion summarizes the key findings and their implications for business strategy and economic understanding.

BUSINESS ECONOMICS

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Economic problem scarcity and demand with resource allocation to manage economy .....1
1.2 Role of supply and demand in economy and explain equilibrium in the market..................3
1.3 Importance of different market system ................................................................................4
1.4 Role of opportunity costs .....................................................................................................5
1.5 Means of elasticity of demand and its importance in market................................................5
TASK 2............................................................................................................................................6
2.1 Implications of pricing and corporate objectives in the operations......................................6
2.2 Compare prices which set in different market structure in perfect competition,
monopolistic environment and oligopolistic competition...........................................................6
2.3 Market structure and operational decisions of selected business .........................................7
2.4 UK regulations that affect the market power of the selected business unit .........................7
TASK 3............................................................................................................................................8
3.1 Structure of the UK economy that changed in 21st century that affect to the business
environment.................................................................................................................................8
3.2 Tools available to meet with macroeconomic policy ...........................................................8
3.3 Performance of the economy in global market with using key indicators in GDP growth
rate, inflation and unemployment...............................................................................................9
3.4 How economic performances affect to the selected business unit........................................9
TASK 4............................................................................................................................................9
4.1 Theory of comparative advantages using relevant illustration.............................................9
4.2 Advantages and disadvantages of free trade which affect to the selected business............10
4.3 Impact of emerging economics such as BRICS on developed economies in general.........10
4.4 Impact of recent domestic and global economic to the economy.......................................10
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
In order to determines effective results in business, economy play vital role that enhance
outcomes in positive way. It is very important for the enterprise to identify future demand,
capital requirement and cost as well. Therefore, it is the important aspect to accomplish business
objectives and create growth in country. In this aspect, present report based on the Marriott hotel
which determines several kinds of services such as bookings of hotel, accommodation, etc. They
deal in international market to provide several kinds of services such as 6000 branches in more
than 122 countries. In order to focus on the present report, it covers economic problem of
scarcity and demand for resource allocation to manage economy. Furthermore, it assists to
compare prices that set for different market for implicating to accomplish corporate objectives.
Moreover, it focuses on performance of UK economy in global market with specific key
indicators. At last, report analysis impact of emerging economies to developed in general
aspects.
TASK 1
1.1 Economic problem scarcity and demand with resource allocation to manage economy
In the UK market main issue is limited resources that create wide problem in the country.
Therefore, government unable to allocate resources to different businesses. Scarcity also require
at workplace to set production, distribution and goods consumption as well. For instance, when
society is unable to make choice towards the production, consumption, distribution, they are
suffers from the various problems that are take place in business. Beside this, there are several
other problems exists in country that face by UK are as follows:
 Unemployment: It is the major problem in UK tat face by government to allocate their
proper resources. In the country, social division is the another problem that consist in
country which directly impact on Marriott hotel. This is because, they have few skilled
members in the nation.
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 Diminishing in economic growth: Low economic growth of the country also create
major impact on the country operations that make problems to cater wages at workplace.
From last 9 years, economic growth highly fluctuating in which in 2008 it was
comparative low as compare to other years. Hence, Marriott also have less availability of
the raw material that impact on its functions and outcomes.
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Illustration 1: UK unemployment
Source: (Unemployment in the UK 2012, 2012)

1.2 Role of supply and demand in economy and explain equilibrium in the market
Supply and demand play vital role in success of the business and its operations. This is
because, it assists to accomplish equilibrium in the market. When prices goes high in Marriott,
supply also required high to complete demand of the products. Therefore, supply increasing with
the price because of the high profits that earn with suppliers (LI and CHEN, 2013). It is also
covered high cost to produce effective results in the business. As enhancement in the customer
demand and requirement, their purchasing power also goes high so that value of the products
also enhances. Beside this, low prices of the products and services also ensure equal benefits to
cost for maximum people which assists to increase demand as well. Increasing demand and
supply also placed as per the prices which curve upward with change in the products demand.
In addition to this, demand curve also move in opposite side when product prices has
been changed. Therefore, it could be said that value of the money need to be placed in equal term
to make effective position then the equilibrium (SUN and ZHAO, 2015). It is the best way to
achieve market profits and revenue. As results, prices are equal to the equilibrium price.
Because, people majorly consume products and services that creates several benefits at equal to
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Illustration 2: UK economic growth
Source: (Pettinger, 2013)

the cost of material. With the help of setting lower price, supply will be develops to reach in
market demand. As results, buyers need to take place to generates more profits and revenue.
1.3 Importance of different market system
In the market economies, there are different elements exists in which organisation
develop their functions and operations. It is very important aspect for the organisation to
demonstrates their pricing and production decisions (Chand, 2016). Therefore, following are
certain types of market system determines with its importance:
 Perfect competition: This market system determines in areas where various sellers and
buyers exists. It is the important system where buyers have alternative option to purchase
any product and services. As results, it is the best way where pricing set according to the
decision of all businesses that are same products and services providing (Galí, 2015).
 Monopoly: It is the another type of market, in which only one business operate and
setting pricing for the products and services. With this regard, one person has right to set
products and services. In this system, the organisation will gain more market share.
 Oligopoly: In this system, main difference is that one business get majority of production
system. In this aspect, pricing set without government regulation.
In respect to deal with the effective system of the market, every business need to include
following market system at workplace:
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Illustration 3: Supply and demand equilibrium
Source: (Market equilibrium, 2017)

Planned market system: In this way, government determines that how to scare resources
and used in the market. Furthermore, economy develops with public sector only.
Mixed economy system: Mixed economy includes combination of government and private
planning as well. It is develop by both sectors.
Market economy system: In this system, all the resources are carried and allocate by the
private firm. There is consumer sovereignty. Price is also determines as the mechanism.
1.4 Role of opportunity costs
Opportunities cost develops value for the activities which possess alternative option
within the organisation. It makes creative role to ascertain decisions that includes trade off
activity in more than two options. Along with this, it is also helps to express relative cost for the
alternative program that assists to meet with next best option. It is the important parameter that
finds application of wide range of business decisions. It assists to make decisions in the Marriott
towards goals and objectives. With this regard, analysis of competitors position can be made on
availability of resources, cost, etc. Following are certain opportunities cost and their roles
determines in the business:
 Opportunities costs assists to find out relevance with scarcity and options that helps to
exchange alternative options. Main role of this is to increase knowledge for several
aspects in business.
 It also assists to take major decisions that are creative to choose several options. It is the
best way to make better decisions as per the business feasibility.
 It also assists to develop fact options that taken by business to focus on their goals and
objectives.
 Opportunities costs assists to explain about the fact that are taken by the organisation to
focus on the results.
 It enhances more productivity for economic system that based on the relative and less
specialised system of economic in the Marriott.
1.5 Means of elasticity of demand and its importance in market
Elasticity of the demand is important tool that assists to measure economics that develop
responsiveness in the market for quantity that are required in the nation. It also assists to
demonstrate quantity of goods and services that are required by customer in Marriott. It is
important to develop following elements in the business:
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 International trade: In this aspect, effective pricing need to be made for goods so that it is
important to assess elasticity of demand for particular goods. There are several nations fix
price for products without inelastic. Therefore, it is important for identify demand of such
goods in the nation.
 Defines policies of government: Elasticity assists to demonstrate price which is major
factor of production. This is because, government will easily increase taxes on the
products on that demand is inelastic.
 Factor pricing: Elasticity of demand also assists to develop price that is important factor
of production. Each factor assists to share participation in national outcomes which
includes different dimensions to enhance the demand of products and services.
TASK 2
2.1 Implications of pricing and corporate objectives in the operations
Pricing is the important element in the Marriott hotel to develop its operations and
functions. Supply and demand of the pricing based on the objectives. Therefore, organisation
able to make brand image for assessing perception of the company. In order to setting the price,
enterprise will able to create awareness with tactics to make strong strategy. Therefore, following
are certain pricing objectives can be implemented at workplace:
 Survival: Prices are need to be cater to assess flexibility in the market. In this regard,
Marriott will able to enhance their sales through charging low price on it. With
implementing survival based pricing, price objectives can be accomplish.
 Profit: Pricing possess different types of effects which take place in direct and indirect
way. It covers costs of the goods that are occurs at time of production.
 Sales: It is the another effective pricing objectives that assists to encourage people to
enhance sales through producing more at low cost. Therefore, market share will be
increasing easily.
2.2 Compare prices which set in different market structure in perfect competition, monopolistic
environment and oligopolistic competition
Market structure Description Pricing decisions
Perfect competition Perfect competition is the Pricing decisions made as per
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situation where several buyers
and sellers are exists
(Davenport and Beck, 2013).
the all business agreed
outcomes. They set this price
because all business need to
work for same products and
services.
Monopolistic competition It is the another competition
where only one business
operate and large number of
buyers exists.
In this aspect, pricing
decisions made through
independent sellers to produce
effective products and services
in the market. Only one
business working so that they
need to develop functions
according to their own
decisions.
Oligopolistic competition In this way, few firms are
existed who compete with each
other.
Therefore, decisions made
through determines dominant
position of the organisation.
Two firms are competing with
each other to set the prices.
2.3 Market structure and operational decisions of selected business
Following are different market structure exists that impact on the organisation operations
and functions: Perfect competition: When Marriott operate their functions and operations in this type of
market structure, they have required perfect knowledge towards the market and its
customers as well. There are several competitors and customer in market so that pricing
set according to that (Galaskiewicz, 2016). Monopolistic competition: It is the another type of market structure in which several
numbers of buyers exist but sales made by only one person. When Marriott comes under
this aspect, they have to operate functions for short run profit.
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 Oligopolistic competition: With this regard, Marriott need to operate their functions and
operations through making themselves as price leader of market.
2.4 UK regulations that affect the market power of the selected business unit
Following are certain regulations exists take place in market which could be affect to the
Marriott and its operation:
The Competition Act 1988: This Act determines several activities that are performed
from the business to cater effective information in the business (Dan, 2015). For instance,
Marriott will fix their prices as per the market competition.
The Enterprise Act 2002: In this act, regulations are determines by the government
which need to be followed by the company to make their successful operations.
Enterprise and Regulatory Reform Act 2013: With this aspect, new competition in the
market determines that impact on the competition and protection of consumer functions in OFT
and OC.
TASK 3
3.1 Structure of the UK economy that changed in 21st century that affect to the business
environment
In this aspect economic widely create impact in 21st century. This is because, government
develop their crucial role to make successful operations and functions in the market. In UK
market, government provides several facilities such as prediction for future, enhance percentages
of GDP that is related with increasing and decreasing of climate effect to deal with different
event. After 20th century, application of the advance technology continuously expand that assists
to increase profitability through create positive impact on Marriott operations (Guozheng, 2013).
Therefore, there are several outcomes in which improvement can be made in economic, social
and technical changes. Further, in the 21st century, progress of UK is high as compare to other
nations. Therefore, it creates effective functioning and results in the Marriott hotel. With the help
of improvement in quality and quantitative aspects, rapid changes can be made at workplace.
3.2 Tools available to meet with macroeconomic policy
In order to make stability and sustainability growth of the country, there are several tools
implemented that determines effective position as well. It assists to make effective results and
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enhancement in the performance to conduct growth. It includes following tools that needed to
meet with macroeconomic policy:
 Fixed policy: This policy assists to operate functions and operations to make changes
through government in order to spend money (Cohen and Kietzmann, 2014). Government
regulates taxes that need to be followed by Marriott so that it impact on the functions and
operations of the country.
 Exchange rate policy: Exchange rate develops with worth of domestic market that is
different from another currency. With this regard, value of money develop in UK market
regarding market forces (Harriss-White and Basile, 2014).
 Monetary policy: It is another important aspect that assists to make decisions and
implement it with changes in cash rates. With this regard, money is major force that
impact on supply and demand in the funds.
3.3 Performance of the economy in global market with using key indicators in GDP growth rate,
inflation and unemployment
In order to make successful government policies, the organisation able to accomplish
macroeconomic objectives (WANG and ZHANG, 2013). There are major four objectives exists
that are explains under here:
 Full employment: In order to accomplish business objectives, government determines
policies that assists to provide employment opportunities for those people who are
unemployed.
 Price stability: In addition to this, inflation also defines as the rising in sustainability as
per the pricing aspect. It assists to create effective measurement in order to assess annual
rate with making certain changes in retail price index (Shapiro and Varian, 2013).
 High growth of economy: Growth of the economy also assists to measure rate of the
certain changes that are exists in GDP. It is the important measurement in annual report
of the country.
3.4 How economic performances affect to the selected business unit
In UK, there are different types of international monetary fund exists that are help to
enhance business opportunities through forecasting. In the global environment, economic
relationship is very strong that assists to serve effective functioning through implement aggregate
benefits as well. It assists to deliver precisely growth through British economy turn to expand the
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performances in 2016 (Manyika, Chui and Marrs, 2013). It is the only nation where strong
position of the country develop that is G7. With this regard, EU importing the outcomes to
perform functions and operations in systematic aspect. International monetary fund develop UK
growth which is around 1.1% in 2017. They are also forecast towards the country that enhances
in 2015 around 1.5%. Uncertain and medium growth of the country diminish because it enhances
trade and migration as potential from downsizing of the financial services' sector.
TASK 4
4.1 Theory of comparative advantages using relevant illustration
In order to develop the comparative advantages, it is very important to implement its
importance in business. It helps to attain several advantages in international market when the
business operate in it (Harriss-White and Basile, 2014). With this regard, below are certain
comparative measurement develop in the Marriott hotel for accomplishing advantages:
David Ricardo's illustration: Ricardo's understand two country productivity through
implementing two types of products that are known as cloth and wine in England and Portugal.
In this aspect, Portugal is more productive to produce these goods. On the other hand, Adam
Smith also assume about England is more productive for only one good whereas Portugal
productive for both goods (TANG and MA, 2014). Therefore, modern vision of the organisation
is to provide effective results that presented through analysis of economic model on the
international economy. This model develop that two nations are produce goods on the basis of
factor of production.
4.2 Advantages and disadvantages of free trade which affect to the selected business
Free trade helps to set lower prices towards consumer that increase export level that make
several benefits from the different economies of scale. It assists to make great choice of goods
and create following advantages:
Advantages: Free trade agreement design that increase trade among different nations. It assists
to create more growth in the nation which enhance profitability and productivity as well. As
results, dynamic business climate and lower government spending etc. implemented (Cohen and
Kietzmann, 2014).
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