OCR A-Level Business external environment overview quiz quiz

It can set any price it likes and customers will still buy from it

It always earns very high supernormal profits in the long run

It has little pricing power and is largely a price taker

It faces no competition at all and operates as a pure monopoly

The cost of raw materials

The number of producers

Production technology

Consumer income

It tends to fall as incomes and confidence drop

It rises sharply as shoppers trade up to premium brands

It is completely unaffected by the downturn in the economy

It immediately becomes perfectly price inelastic for buyers

It lowers the firm's interest costs and frees up cash for investment

It raises the firm's interest costs and can dampen customer demand

It has no effect at all on the firm's costs or on its customers

It always increases the firm's overall profit margin regardless

Exports become dearer abroad and imported inputs become cheaper

No change at all to either the price of exports or of imports

Exports cheaper abroad and imported inputs more expensive

Both exports and imported inputs become cheaper at the same time

The central bank's control of interest rates and the supply of money

An individual firm's pricing strategy and its approach to discounting

The setting of the national minimum wage rate alone and nothing else at all besides

The government's use of taxation and public spending to influence the economy

It raises the firm's wage bill and may push it to raise prices or automate

It lowers the firm's total wage bill and so directly reduces its operating costs

It has no effect at all on the firm's costs or its profit margins

It only affects large firms and leaves smaller employers untouched

Permanently higher compliance and administration costs that never fall over the long run

Lower waste and energy costs, access to green markets and a stronger reputation

Slower operations and reduced output for the entire life of the firm

A guaranteed and permanent fall in profit across every future year

They are always exactly the same thing in every case, so anything that is legal must automatically be ethical too, and the law fully settles all moral questions

Ethical conduct is fully required and enforced by the law in every single case

Acting legally means obeying the law; acting ethically means doing what is morally right, which can go beyond the law

Behaviour that is legal is always unethical, and only illegal acts can ever be ethical

Because behaving ethically carries no cost whatsoever to the business in any period at all

Because the law itself directly guarantees a firm a minimum level of profit

Because customers never notice or care about how ethically a firm behaves

Because ethical conduct builds reputation, trust and loyalty that support long-run profit