Presentation Transcript

1. Thought for the day:

   discuss…..

2. External costs and benefitsAppreciate the concepts of social costs and benefitsUnderstand the difference between a socialcost and social benefit and a financial cost and a financial benefitShow an understanding of how business activity can create themUse examples to show how business decisions create social costs and benefitsApply such concepts to a given business decisionEvaluate the possible consequences to stakeholders of a given business decisionExchange ratesUnderstand how importing/exporting decisions might be affected by changes in exchange ratesUnderstand the concept of a rate of exchange of a currencyUnderstand what is meant by an appreciation and depreciation of a currencyShow awareness of the importance of exchange rate changes to importing and exporting businessesBusiness cycleThe main phases of the cycleDescribe the main stages of a business cycleImpact of boom/recession on businessUnderstand the impact of the stages on a business in terms of sales, profits and business costs
3. How to get an A A Grade Evaluate, discuss, justify, advise, recommend. reasoned explanations, develop arguments, understand implications and draw inferences Examine, Analyse, Interpret, Formulate, Cause and Affect, advantages & disadvantages. A04 Evaluation Apply facts, terms, concepts, theories and techniques to business problems and issues. Link to a business. A03 Anayslis A02 Application facts, terms, concepts and conventions appropriate to the syllabus; theories and techniques A01 Knowledge & Understanding
4. Exchange rates Understand how importing/exporting decisions might be affected by changes in exchange rates Understand the concept of a rate of exchange of a currency Understand what is meant by an appreciation and depreciation of a currency Show awareness of the importance of exchange rate changes to importing and exporting businesses
5. The exchange rate measures the value of one currency in terms of foreign currencies. Appreciation of currency means higher exchange rates, means that export prices will be high therefore the exporter will have less price competiveness. Depreciation of the currency means lower exchange rate means the domestic firms that import raw materials and components will suffer from having to pay relatively higher prices. Large unpredictable changes in the exchange rate can make business planning difficult because a business cannot predict its export earnings or costs of imported materials.
6. Exchange Rates Australia dollar strong Australian dollar weak AUSD$2 = SING$1 So if Australia wants to sell for AUD$20 (to make $10 profit) will have to sell for… SING$10 If AUD keeps getting weaker.. Can be cheaper.. AUSD$1 = SING$2 So if Australia wants to sell for AUD$20 (to make $10 profit) will have to sell for… SING$40 If AUD keeps getting more expensive then will have to increase selling price (to maintain profit margin)
7. Business cycle To learn: The main phases of the cycleDescribe the main stages of a business cycleImpact of boom/recession on business Understand the impact of the stages on a business in terms of sales, profits and business costs

8. The Business (Economic) Cycle

9. The Business Cycle Typical business cycle Peak Recession Trough Recovery
10. Downturn: Demand falls Output falls Employment falls Falling in investment Many business making losses Some business close down.
11. Recovery: Stock levels begin to fall Output increases Employment rises.
12. Boom: Full capacity in the economy Prices increase Investment increases Business working flat out Shortage of skilled labour (wages rise).
13. External costs and benefits Appreciate the concepts of social costs and benefitsUnderstand the difference between a social cost and social benefit and a financial cost and a financial benefitShow an understanding of how business activity can create themUse examples to show how business decisions create social costs and benefitsApply such concepts to a given business decisionEvaluate the possible consequences to stakeholders of a given business decision
14. p Pg 240
15. What did I learn this lesson that I didn’t know before?
16. PlenaryLevel achieved_____ What do you now know as a result of today’s lesson? What are your areas for improvement? What are you going to do about this?