5.2 Influences on Business Activity

5.2.1 Location decisions Show awareness of how the government can influence such factors
• Understanding of the effects of measures such as government grants, subsidies and planning regulations • Use examples with reference to own national economy • Knowledge of specific measures NOT required

5.2.2 Workforce and the working environment (health and safety, employment protection)
Describe the work of trade unions

• Understand the concept of a trade union

• Show awareness of the benefits that union membership can provide for employees

Show an awareness of how trade unions can influence business behaviour

• Use examples to show how business behaviour might be modified in terms of levels of pay and treatment of employees

Show an awareness of ethical considerations in business activity

• Show awareness of the possible conflict between the profit motive and ethical considerations such as exploitation of employees [e.g. using child labour]

Demonstrate an understanding of the importance of health and safety requirements

• Use examples to show how businesses might have to change their behaviour to conform to legislation regarding conditions at work [e.g. protection from dangerous machinery, safety equipment and clothing, hygienic conditions and hours of work]

Understand the main features of employment contracts and employment legislation

• Describe the main features of an employment contract

• Understand why employees need protection against discrimination and unfair dismissal

• Use examples to demonstrate such protection in terms of racial and gender discrimination

• Knowledge of specific legislation is NOT required

5.2.3 The consumer
Understand how and why consumer interests are protected

• Demonstrate an understanding of the ways in which consumer protection benefits consumers e.g. protection against dangerous products and substances, misleading selling

• Use examples to illustrate the need for such protection

5.2.4 External costs and benefits Appreciate the concepts of social costs and benefits
• Understand the difference between a social cost and social benefit and a financial cost and a financial benefit

Show an understanding of how business activity can create them

• Use examples to show how business decisions create social costs and benefits

Apply such concepts to a given business decision

• Evaluate the possible consequences to stakeholders of a given business decision

5.2.5 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

5.2.6 Business cycle The main phases of the cycle
• Describe the main stages of a business cycle

Impact of boom/recession on business

• Understand the impact of the stages on a business in terms of sales, profits and business costs