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These factors affect change in business culture and leadership.

Government wants some control over business, to achieve its economic objectives, using a range of policies, regulations and laws.


Encourage growth and stability- creates more opportunity for business. Achieve low inflation (2%) for greater price stability so easier to compete with rivals at home and abroad. Low unemployment- higher consumer spending, better demand and growth. Strong current account balance- more income than expenditure to avoid national debt. Stable exchange rate- easier to forecast.

  • Exchange rate policy- how are they set? Floating/fixed?
  • Taxation- Indirect/direct. More tax=less profits. VAT (rises= higher prices, therefore reduced demand for the same goods and services), Excise Duty, Income Tax, Corporation Tax. All these affect business strategy e.g. Pringles
  • Deregulation- removing legal barriers to entering industry, more efficiency, lower prices therefore better economy.
  • Protectionism- restricting levels of imports from non EU…


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