Assignment 2
P4- Discuss the internal, external and
competitive environment on a given
business
External environment
Political environment
One way in which a business can receive support is through money given to them by the
government. A grant is a one-off payment awarded to the business by the government
which they do not need to pay back this is often used to help give the business the funds to
start new business ideas. The other form of monetary funds the government gives to
businesses are subsidies. This is a regular payment given to the business it’s considered to
improve the welfare of the society. Businesses who work on a global scale are aware of the
struggles of importing and exporting products around the world. Therefore, some
businesses choose to operate as members of trading communities such as the European
union. This heavily decreases trade tariffs on imports making it significantly easier for trade.
Amazon continues to receive subsidies from the government to help it increase its
infrastructure for its warehouses and data centers. This is because it provides as significant
number of jobs for people in the UK and most of these jobs require low skill. The aim of
these government subsidies is to reduce the unemployment rate in the UK and get more
people paying taxes. Amazon recently had grants from the UK government to assist them
with the distribution of COVID 19 testing kits because of Amazons highly developed
infrastructure in delivering products quickly. Amazon is a global business that operates in
many different countries; the business regularly takes advantage of the trade blocs such as
NAFTA and the European Union this is because tariffs are much lower.
Economic environment
The economy is heavily influential for all businesses, they hope to see the economy grow
with the business. Economic growth can be split up into short run and long run. Short run is
where the GDP increases as a result of the increase in demand. Long run economic growth is
the sustained rise in the quantity of goods and services that an economy produces.
Economic growth affects Amazon because it varies the demand people have for their
products. However, because of Amazons influence they contribute to this economic growth
as they are a huge employer around the world.
P4- Discuss the internal, external and
competitive environment on a given
business
External environment
Political environment
One way in which a business can receive support is through money given to them by the
government. A grant is a one-off payment awarded to the business by the government
which they do not need to pay back this is often used to help give the business the funds to
start new business ideas. The other form of monetary funds the government gives to
businesses are subsidies. This is a regular payment given to the business it’s considered to
improve the welfare of the society. Businesses who work on a global scale are aware of the
struggles of importing and exporting products around the world. Therefore, some
businesses choose to operate as members of trading communities such as the European
union. This heavily decreases trade tariffs on imports making it significantly easier for trade.
Amazon continues to receive subsidies from the government to help it increase its
infrastructure for its warehouses and data centers. This is because it provides as significant
number of jobs for people in the UK and most of these jobs require low skill. The aim of
these government subsidies is to reduce the unemployment rate in the UK and get more
people paying taxes. Amazon recently had grants from the UK government to assist them
with the distribution of COVID 19 testing kits because of Amazons highly developed
infrastructure in delivering products quickly. Amazon is a global business that operates in
many different countries; the business regularly takes advantage of the trade blocs such as
NAFTA and the European Union this is because tariffs are much lower.
Economic environment
The economy is heavily influential for all businesses, they hope to see the economy grow
with the business. Economic growth can be split up into short run and long run. Short run is
where the GDP increases as a result of the increase in demand. Long run economic growth is
the sustained rise in the quantity of goods and services that an economy produces.
Economic growth affects Amazon because it varies the demand people have for their
products. However, because of Amazons influence they contribute to this economic growth
as they are a huge employer around the world.
