Title:- To illustrate the 2 different economies in 2 different countries

Procedure
In this report I will talk about the economies of 2 different countries and they will be America and the Singapore. Then I will compare them both and link them to a business

Findings/Content

This first country whose economy that is going to be mentioned is the America. The government in America thought that in order for America to make funding and also provide jobs for their people, They should put money in the economy and because of this, the economy hit their lowest point in 1930. Around that time their president chose to design a dam which would be called the hoover dam.Hoover personally believed that by making the hoover dam, they will provide funding in America and make new jobs for people inn the country. America still use this kind of technique right now to expand their country. The idea to invest in the economy in order to increase their economic growth was John Maynard Keynes . John Maynard's Keynes theory thought if the government invested in it economy it would boost the economy. Ways to make sure this happens are opening new businesses so more people will have jobs, also he thought that the government must lower its interest rates because if they are low organisations can extract bank loans more easily and they can also use these loans to develop more outlets, if organisations continue to take out bank loans. This can be used to increase employees wages so employees can spend more and this will increase the money the economy makes. This is the main reason why John Maynard Keynes made this theory saying that in order for a country to expand, they will have to increase their value in investment.

The second country that will be mentioned is Singapore, The economy in Singapore is strong because they have a free market because the government does not have any control over it so for example the government has no right to make important decisions in the country like to reduce the interest rates or to introduce them. So to conclude Frederic Hayek thought that for a country to get out of recession/depression, They should not receive any help from the government.

This idea came from a well known theorist called Fredrick Hayek Frederic von Hayek. His theory was that if countries are to be stable, they should act independently with no help from the government because he believed that if government was in control of the economy, humans would not know about how the economy works and not know how to maintain their economy. He also believed that if the government was in control, this will have a negative effect on the economy which could result in the great depression. So to conclude Hayek believed that if the country encountered a problem they should solve it by themselves.

If America opened a Tesco store in their country, Tesco will be affected because America uses John Maynard Keynes theory. This might have a negative effect on Tesco because they believe that they must reduce their interest rates in order for organisations to extract bank loans. This is an disadvantage to Tesco because if other organisations take out loans this will increase competition because their will be more organisation in the same market so Tesco might lose customers if other organisations provide better service so this will decrease their profit.But on the other hand this might benefit Tesco because Americas interest rates are low so it will cost businesses less to take out a business loan so Tesco will save money and will not lose profit. They will use bank loans in order to increase their number of outlets that will rival Tesco branches on their street.

If Tesco opened in Singapore this will have a positive effect on the organisation because Singapore is a wealthy country so if Tesco wants to have a deal with another company they will be able to buy products at low prices as Singapore has a high currency rating in contrast to other countries internationally e.g. If Singapore want to buy food items from Nigeria they will switch the Singapore currency to Nigeria currency(Naira), meaning Tesco can get more capital from Nigeria because Singapore currency is higher than their own currency. Tesco can buy more items because of the extra money they have gained from the other currency. Tesco in Singapore will be affected negatively because Singapore has a free market so if Tesco fails in Singapore financially they will receive no help from the government for example taking out bank loans, overdrafts etc. because they are in a free market so decisions will not be made by the government. So Singapore economy will not be able to help Tesco decrease their interest rates so they will not spend a lot of money taking out a bank loan to stay in business. If Singapore does not have enough money to continue with business the Tesco will close down completely. If this happens, this will affect the Singaporean economy greatly.

America's economical actions are taken over by John Maynard Keynes theory and Singapore's economical actions are taken over by Frederic Hayek's theory. The way that both economies of America and Singapore are different because The government of America controls their economy by continually paying finances into the economy and frequently making change to the value of the interest rates to make new organisations.they will want to make sure that they open a lot of outlets of new business so this adds more finance to the economy. Singapore economy is a complete contrast to America economy because they operate by using free markets and receive no intervention from the government. The Singaporean economy is developing better than the American economy this way because people are taking care of the economy themselves. The two theories that were made came from two well known Theorists- they are called Frederic Hayek and John Maynard Keynes. Maynard Keynes believed that for a country to be successful, they will need money to be invested continuously from the government, but Fredrick Hayek thought that free markets will better than receiving help from the government. If Tesco branches opened in Singapore, this will have a positive affect because Singapore is a fruitful country because they have such a high currency value. However if a Tesco branch opened in America, this will Affect them greatly because the interest rates will change contiounsly so the general public will want to receive bank loans from the bank in order to run their own businesses that will compete with Tesco over the same target market.

Pestle for Tesco and Mcdonalds

In this Table the Political, Economic, Social, Technological, Environmental and Legal factors for Tesco and Mcdonalds

Political | Tesco is a well known company worldwide and globally, These factors will affect them because this will include tax, legislation and how stable the country is when they operate in it. Right now some countries aren’t that stable. Tesco will try and make more opportunities for employees and further increase their employees.McDonald's are affected by fast food regulations for example the health and the hygiene policy. The government has realized that people in the UK have been having disease e.g. cardiovascular disease because of eating too much fast food. The level of hygiene is important to a fast food business. A healthy relationship with the government will benefit Mcdonalds. | Economical | Economic factors are important to Tesco because the economy will have effect on the costs, prices and profits. So based on policies, Tesco will have to be careful of any changes in taxation and any other factors that will affect the finance department. Tesco currently have a 30% market share in the uk. Tesco are focusing on marketing their brand rather than marketing their more expensive products. This will save Tesco money that they can invest into their business.Economic factors will affect McDonalds because their organizational policies will include tax on their products, exchange rates and unemployment rates .McDonald's is a well-known international outlet. In every country there will be different rules and regulations that will have effects on organizations. So McDonalds will have transfer their goods in any available local markets, so that will mean that the exchange rate will have an effect on the cost of running businesses and the productivity levels of their employees . | Social | There have been a great assortment of social changes in their economy e.g. customers buying a lot of shopping. Tesco has been influenced to increase the quantity of Goods they sell. Tesco’s customers are more aware of health issues that are arising because of their attitude towards their food. Tesco will want to adapt to the opinions of the customers by providing more healthier options for example organic foods.People's changing lifestyle will affect McDonald's sales. Usually people will like to eat more expensive food because they will like to eat higher quality food than just regular fast food. But different countries will have different eating habits. In western countries like USA they like to eat normal potatoes and meat In China customers will prefer rice to potatoes and rice | Technological | Technological factors will provide two main benefits to Tesco. The first main advantage is the establishment of online shopping. This will make the service of Tesco faster than before. The Second benefit is that they have also introduce self-checkout services. Benefit of this is that customers will have to spend less time to be served. This will save energy as well as money.In the fast food industry Technology does not affect companies that much, but with high levels of technology will help business to develop their management and increase their productivity levels. McDonalds use technology in many ways for example advertising goods on social media, offer Wi-Fi connection and installing new internet equipment to satisfy customer needs. | Environmental | In order to help the environment, Tesco are pledged to decrease the carbon footprint by 50% in 2020. Tesco is also decreasing their Waste products by increasing the ethics of their customers.Organisation normally face complaints from customers because customers believe that McDonalds create a lot of environmental problems e.g. air pollution and wasting a lot of commodities. McDonalds use to use polystyrene as their packaging for their goods before they started to use paper packaging. There have been some pressure groups that have been against McDonalds because of their large levels of waste and slaughtering innocent animals | Legal | Legal factors will affect Tesco for example the FRC in 2004 launched code of practice that will ban certain acts for example altering the prices of their products without announcement and asking payments from suppliers. To make easier decisions on their policies, Tesco will reduce the prices of their fuel according to the cost of their grocery stores.Rules and regulations are important to organizations. As a well known fast food company, McDonalds should achieve a large variety of requirements in different countries e.g. tax requirements and company law. |

Conclusion

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