Unit 8

• How does the EU make trade easier?

  1. few trade barriers
  2. smooths price differences
  3. same custom duties
  4. freedom of movement
  5. common policies
• What is included in the Competition Act 1998?

  1. can't conspire to fix prices
  2. can't conspire with competitors to limit production
  3. can't divide the market for competition
• How do laws prevent businesses from abusing their market positions?

  1. dominant businesses cannot demand exclusivity
  2. can't tie products for retailers (product tying)
  3. can't sell goods at a loss to force smaller competitors out of the marker (predatory pricing)
• What's a monopoly?


  When a business has control over the whole market.
• What did the Waste Electrical and Electronic Equipment (WEEE) force EU businesses to do?

  1. Increase recycling
  2. Increase their responsibility
• What does Landfill Tax do in 1996?

  Reduce the amount of waste being dumped into landfill sites.
• What did the EU Packaging Waste Directive do?


  Force EU businesses to increase recycled packaging.
• What did the Climate Change Act do?

  Encourage UK plcs to report their greenhouse gas emissions in an annual report so they're more likely to reduce them
• What does the trade descriptions act 1968 do?

  Protect customers from misleading advertising or false descriptions
• What does the sale of goods act 1979 do?

  Set out consumer rights so purchased goods are fit for purpose and are at a satisfactory level.
• What does the consumer protection act 1987 do?


  Ensure consumer products are safe
• What does the data protection act 1998 do?

  Protects customers from data misuse and holding
• What does the Equality Act 2010 mean for employment?


  Prevents employee discrimination based on the protected characteristics.
• Whats direct discrimination?


  Treating someone less favourably if they have protected characteristics
• Whats indirect discrimination?


  Where everyone is treated the same but it has negative impacts on one group of people due to protected characteristics and necessities not being met.
• What can employees attend if they feel they're being treated unfairly?

  Employment tribunal
• What does the national minimun wage 1999 ensure?

  Employees are paid fairly.
• Why is the national living wage controversial?


  It's lower than the independently calculated living wage so if employers pay their employees more it increases motivation and reduced absenteeism. It makes the employer more ethical.
• How much can employers be fined for not providing minimun wage?

  £20,000 per employee
• What does the Health and Safety at Work Act 1974 do?


  Ensure employees are safe in the workplace.
• What are employees entitled to?

  1. 28 days of paid holiday
  2. parental leave
• What does the State Pension rate depend one?

  How many years someone has paid national insurance.
• Whats the new pension law?


  Employers must enrol employees into a workplace pension and pay into it.
• What are the government strategies that encourage entrepreneurship?

  1. Enterprise investment scheme - borrow money at low interest rates to encourage private investment
  2. Don't have to pay business rates and Employment Allowance, reducing their National Insurance Contributions by £2,000
  3. The Great Business Website - advises people on setting uo businesses
  4. Initiatives for young entrepreneurs
• What did the World Trade Organisation do?

  Remove tariffs and provide more trading opportunities
• What are Quotas?


  Trade restrictions set by governments which provides a limit for imports/ exports. This is called a protectionist policy as it protects the economy of the country it's operating in.
• What are Trade Embargos?

  When trade is banned in specific counties for various reasons.
• Whats the GDP?


  The total market value of produced goods/ services in a nation over a period of time. It measures economic performance.
• Whats rapid economic growth followed by?

  Recession
• Whats inflation?


  The increase in price of goods and services
• Whats a demand-pull inflation?


  When high inflation is caused by too much demand. Often from an increase in disposable income. As companies can't supply goods as quickly, they increase their prices.
• Whats cost-push inflation?


  Increase in product prices due to an increase in the price of raw materials. This causes businesses to increase their prices to maintain profit.
• How does the government control the economy?

  1. Fiscal policy
  2. Monetary policy
• What does fiscal policy do?


  Sets tax rates and government spending. It impacts the economy by increasing and decreasing disposable income, affecting purchasing habits.
• What does monetary policy do?


  The Bank of England changes the interest rates to encourage/ discourage borrowing and saving, affecting the economy.
• Whats protectionism?


  The government protects domestic businesses and jobs from foreign competition, by imposing tariffs and quotas on imported products.
• Whats open trade?


  When imports and exports are not restricted by the government.
• Whats globalisation?


  How interconnected the world is, it provides opportunities to many businesses.
• What opportunities do businesses have with emerging economies?


  1. Good opportunity as the offer good returns as they're experiencing rapid growth.
  2. Labour and resources are cheaper, decreasing unit costs.
  3. Helps people move out of poverty and find employment
  4. However, they're risky investments as they're less stable perhaps due to the risk of political changes, currency fluctuations and infrastructure problems.
• What are the difficulties of globalisation?

  1. Whilst GDP grows, individuals may experience high levels of poverty
  2. Trade barriers
  3. Language and cultural barriers
  4. Emerging economies have different currencies so businesses are vulnerable to changes in currency value.