EEB PPT S1 Int
EEB PPT S1 Int
EEB PPT S1 Int
Lower
Middle
Micro-Economic Analysis:
Given overall economic
environment.
Demand Analysis and Forecasting
Production and Cost Analysis
Pricing Policies
Investment Appraisal and Risk
Analysis
Higher
Macroeconomic Analysis:
Government Policy and Impact
Analysis
Specific Industry Analysis
Strategic Planning
Business Organizations
Strategic Decisions
Expansion
Diversification
Mergers &
Acquisition
Launching New
Products
R&D
Decisions
Affected by Changing
Macroeconomic Policies and
Environment
copyright@Veena Keshav Pailwar
Assessment of Economic
Environment
National
Income
Prices
& Inflation
Taxes,
Budget
Deficit
Exchange
Trade
Rate
& Foreign Capital
Employment
Interest rate
Wages
Credit
Economic System
Institutions
Principles
Mechanism
Economic System
Classification
of
Economic
Systems
On the basis
of
extent of
Market
Mechanism
On the basis
of
Ownership
of Resources
Capitalism
Mixed
System
Socialism/
Market
Mixed
Communism Economies Economies
copyright@Veena Keshav Pailwar
Planned
Economies
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Objective
Ownership of Allocation
Resources
Mechanism
Capitalism
Individual economic
freedom and each
according to his
means
Private
Market
Individuals &
Organizations
Socialism: Each
according to his
deeds
Communism: Each
according to his
needs
State
Market
Economies
Socialism
Planned
Economies
Mixed System
Mixed
Economies
Planning
Jointly
determined by
Consumers,
Businesses and
the Government
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China
India
Base
Started more of a
capitalist system
Movement
Gradually
moved
towards
socialist
market
structure
Gradually given
important role to
the government in
the stabilization of
the economy and
maintaining
orderly conditions
in the economy
Has significantly
liberalized the
economy
Moving more
and more
towards free
market economic
structure
USA
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Types of Planning
Imperative
Basic Element Element of
Compulsion
Indicative
Element of Facilitation
and Guidance
Role for
Government
Government
dictates the
production,
investment,
distribution,
consumption and
pricing decisions
Role for
Market forces have Market forces have
Market Forces no role to play
substantial role to play
Case: UEE 1.2
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Trend in
Macroeconomic Variables
Short Term
Various Phases of
Business Cycles
Long Term
Structure of
an Economy
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National Income
Market potential
Inflation
Employment and
Capacity Utilization
Saving
Investment
Fiscal Deficit
Money Supply
Increasing liquidity
Easy availability of credit
Veena Keshav Pailwar
Inflationary
pressure
copyright@Prentice Hall of India
13
Balance of Payment
Current Account Deficit
Capital Account
FDI Inflow
Portfolio Inflow
Hot-money, Volatility,
Debt Inflow
Exchange Rate
Depreciation
Living conditions
Veena Keshav Pailwar
copyright@Prentice Hall of India
14
Fiscal Policy
Monetary Policy
Industrial Policy
Trade Policy
Exchange Rate Policy
Other Government Policies
Affects
Level of Aggregate Demand
Production Capacity
Availability of Credit
Cost of Funds
Infrastructure
Market Structure
Competition
etc.
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International Business
Environment
Economic trends and conditions
out side the country
Affects
Exports: Aggregate demand
Cost of Production
Inflation
Trade and Capital Flows
Exchange Rate
copyright@Veena Keshav Pailwar
16
Economic
Structure
Determines the Physical Framework
for the Economy and Business Units
Determinants
Impact
Population Size
Level of Demand
Technology
Production Method
copyright@Veena Keshav Pailwar
17
Economic Structure
Constituents
Production Structure
Demand Structure
Employment Structure
Fiscal Structure
Financial Structure
Trade Structure
Demographic Structure
Measurements
Sectoral composition of output
Expenditure composition
Employment by eco activities
Composition of government
expenditure and revenue
Bank vs Market based
Sectoral export and import shares
Population Age, Gender
Distribution, and Density
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Stage of Development
Agrarian Economy
Industrial Economy
Service Oriented
Economy
Advanced Stage of
Development of the Economy
copyright@Veena Keshav Pailwar
19
Trend
Seasonal
Cyclical
Random
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Course Coverage
Constituents of Business Environment
National Income & Environment Scanning
Inflation and Business Environment
Fiscal Policy and Environment
Financial System, Crisis & Reforms
Balance of Payment
Trade Flows and International Linkages
Capital Flows, Growth and Macroeconomic Instability
Exchange Rate Regimes & Currency Convertibility
Text Book:
Economic Environment of
Business, 3rd edition
Veena K. Pailwar
copyright@Veena Keshav Pailwar
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Pattern of Evaluation
S. No.
I
1.
Components
Weightages
Topics
Internal Assessment
Group Activities*
Group Case Report
60%
20%
2.
20%
Attendance,
Punctuality,
Assignments,
Quizzes, Class
Discussion, Class
Behaviour, etc.
II.
20%
III
40%
Given Country
Given Topic
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