Assignment 3 Of 4 1 Essay examples

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Describe the Influence of Two Contrasting Economic Environments on Business Activities with a Selected Organisation

Growth
Within my selected organisation, Tesco, there are 2 important economic environments that have an influence on business activities. Both economic environments will have a different way on affecting Tesco. The economic environments are growth and recession. Economic growth occurs when more goods are being produced and consumed, and incomes are rising. A growth company tends to have very profitable reinvestment opportunities for its own taken earnings. Economic growth will affect Tesco as it would increase their profits due to more people wanting more products and wanting to spend their money. As people have more money to spend on luxuries instead of the essentials it means that the higher value products will be brought. For example the Andrex toilet rolls will be brought instead of Tesco value, because of this it means more money is being spent in the store which is an advantage for Tesco. Another way Tesco could grow is to open up more stores in different countries, this would mean that more profit will come in to the business; it will also increase the popularity of the company which would attract more and more customers. These graphs prove that increasing the amount of stores around the world also increase the businesses sales turnover.

Source: http://www.bized.co.uk/educators/16-19/business/strategy/activity/strategic1.htm

Recession
Recession occurs when people involved in business become more cautious and: Customers cut back on

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