45 views5 pages
8 Feb 2011
School
Department
Course
Chapter 2 Notes
External Environment – everything outside an organizations boundaries that might
affect it
Economic Environment - conditions of the economic system in which an organization
operates
- business has an “inside (us) aboundary” and an “outside (them)
Typical Environments:
Economic environment
Technological environment
Social environment (diff customs)
Political environment
Legal environment
Three Key Goals of the Canadian Economy
1. economic growth – produce more of wants, ppl spend more, profits-> better SofL
2. economic stability
3. full employment
Measure Economic Growth
aggregate output
standard of living
gross domestic product
productivity
Growth Means:
-Produce more
-Being more efficient
Threats: inflation, deflation and unemployment
Business Cycle – pattern of short-term ups and downs (expansions and contractions) in
an economy
Recession- period during which aggregate out-put, as measured by real GDP, declines
www.notesolution.com
Unlock document

This preview shows pages 1-2 of the document.
Unlock all 5 pages and 3 million more documents.

Already have an account? Log in
Depression- particularly severe and long-lasting recession
main measure of growth in the business cycle is aggregate output
Aggregate output – total quantity of goods and services produced by an economic
system during a given period – **when output rises STof living rises
Standard of living – total quantity and quality of goods and services that a countries
citizens can purchase with the currency used in their economic system
GDP – total value of all goods and services produced within a given period by a national
economy through domestic factors of production ( consumer spending, government
spending, business investments, and net exports) – FINAL GOODS ONLY
GNP – total value of all goods and services produced by a national economy within a
given period of regardless of where the factors of production are located
E.g, profits of a Canadian company in Brazil, count towards GNP, because its outside of
Canada. Meanwhile profits of a Brazilian company in Canada counts towards CDN GDP
GDP per Capita – GDP divided by population a amount of GDP per person
Nominal GDP – GDP measured in current dollars or with all components valued at
current prices
Real GDP – GDP calculated to account for changes in currency values and price changes
Purchasing power Parity – principle that exchange rates are set so that the prices of
similar products in different countries are about the same
www.notesolution.com
Unlock document

This preview shows pages 1-2 of the document.
Unlock all 5 pages and 3 million more documents.

Already have an account? Log in

Document Summary

External environment everything outside an organizations boundaries that might affect it. Economic environment - conditions of the economic system in which an organization operates. Business has an inside (us) a boundary and an outside (them) Typical environments: economic environment, technological environment, social environment (diff customs, political environment, legal environment. Three key goals of the canadian economy: economic growth produce more of wants, ppl spend more, profits-> better sofl, economic stability. Measure economic growth aggregate output standard of living gross domestic product productivity. Business cycle pattern of short-term ups and downs (expansions and contractions) in an economy. Recession- period during which aggregate out-put, as measured by real gdp, declines www. notesolution. com. main measure of growth in the business cycle is aggregate output. Aggregate output total quantity of goods and services produced by an economic system during a given period **when output rises stof living rises.

Get access

Grade+20% OFF
$8 USD/m$10 USD/m
Billed $96 USD annually
Grade+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
40 Verified Answers
Class+
$8 USD/m
Billed $96 USD annually
Class+
Homework Help
Study Guides
Textbook Solutions
Class Notes
Textbook Notes
Booster Class
30 Verified Answers