Economic issues
Introduced| English | Meaning |
|---|---|
| recession/rɪˈseʃn/ | A significant, sustained decline in an economy's overall activity. |
| business cycle/ˈbɪznəs ˈsaɪkl/ | Fluctuations in economic activity between expansion and contraction over time. |
| boom/buːm/ | A period of strong economic activity, often with rapid growth and high demand. |
| inflation/ɪnˈfleɪʃn/ | A sustained increase in the general price level of goods and services. |
| unemployment/ʌnemˈplɔɪmənt/ | The state of being without work while willing and available to work and actively seeking a job. |
| interest rates/ˈɪntrest reɪts/ | Charges for borrowing, or returns on lending, expressed as percentages of the amount over a period. |
| currency/ˈkʌrənsi/ | The money used in a particular economy, especially its notes, coins and unit of denomination. |
| imports/ɪmˈpɔːts/ | Goods and services bought from sellers in other countries. |
| exports/ˈekspɔːts/ | Goods and services sold to buyers in other countries. |
| exchange rates/eksˈtʃeɪndʒ reɪts/ | The price of one currency expressed in units of another currency. |
The economy a business can't control
- A business can run itself well and still be hit by a recession 衰退, rising prices, or a rate change.
- These economic issues affect every business but lie outside its control.
External influences lab
Classify outside changes by the channel that hits the business.
During a recession, most businesses experience:
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A recession cuts demand and sales.
The phase of the business cycle with falling output and rising unemployment is a ______.
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A recession is the downturn phase.
The business cycle 经济周期
- The economy moves through boom 繁荣 → slowdown → recession → recovery.
- In a boom, demand and profits rise; in a recession, sales fall and firms may cut jobs.
Demand for most businesses rises in a boom and falls in a recession.
Inflation is most likely to:
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Inflation pushes up costs and erodes spending power.
Higher interest rates tend to increase consumer spending and borrowing.
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False. Higher interest rates make borrowing dearer and saving more attractive, so consumer spending and borrowing tend to fall.
Inflation 通货膨胀, unemployment 失业 and interest rates 利率
- Inflation (rising prices) raises a firm's costs and reduces customers' spending power.
- High unemployment means weaker demand but cheaper, easier hiring.
- Higher interest rates raise borrowing costs and cut spending.
How a stronger or weaker currency 货币 changes imports 进口 and exports 出口
A weaker domestic currency makes a firm's exports:
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A weaker currency lowers the foreign price of exports.
Exchange rates 汇率
- A stronger currency makes exports dearer abroad and imports cheaper at home.
- A weaker currency makes exports cheaper (more competitive) and imports dearer.
The same change affects firms differently. A recession hurts a luxury shop but may help a discount store. Always link an economic change to the specific business.
You've got it
- the business cycle: boom → slowdown → recession → recovery
- inflation raises costs; higher interest rates cut spending; unemployment weakens demand
- a stronger currency hurts exporters; a weaker one helps them
Write from a luxury shop and a discount shop
- In a recession a luxury shop's sales fall by 20 percent.
- A discount shop's sales rise by 8 percent. The same economic change does not hit every firm the same way.
In a recession a luxury shop's sales fall by 20 percent while a discount shop's sales rise by 8 percent. Why can the same recession have these two results?
An economic change has to be linked to the specific business. A recession is not one result for every shop.
What can happen to these two shops in the same recession?
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The luxury shop's 20 percent fall and the discount shop's 8 percent rise are two results of one recession.