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The changes in the economic environment are going to show its effects on Ionians K. This is going to be shown in the number of sales they are making. The economic review for December 2011 shows how the manufacturing output fell in October 2011. It also rise in unemployment in October, November and December. This must have affected the number of sales businesses like Ionians UK are making because they are not going to have as many customers to buy their products. In 201 1, the manufacturing output fell and this caused construction and labor weak; this then resulted in an increase in unemployment.

This economic change had an effect on the economic environment by showing there wasn’t as many employees in working areas such as construction and labor. This must have had an impact on the number of products being manufactured in Ionians XII. This must have then impacted on the company by not allowing them to make as many sales as their company would expect to make. This shows that the economy review shows that the economy is at a recession. The economy review for December 201 1 shows how manufacturing fell and this has left less people working in labor and so they are unemployed, this means that consumers are going to ray to spend less.This economic change can have an impact on Ionians UK because it would mean that customers are not willing to spend a lot on things like vehicles and so they would have to drop prices or slow the number of products being manufactured.

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This can also mean the Ionians UK has had to fire their employees and cut the number of employees they have in their manufacturing because they are not going to want to pay them if there aren’t many products to manufacture. This is going to result in an increase in unemployment. This could have been caused by the manufacturing falling inOctober 201 1 when the rise in unemployment was increasing. This is a big change in the economic environment because it has had an impact on Ionians UK because it shows that they are currently facing a recession. This has been shown in the number of employees are losing their jobs and also how this is having an impact on the number Of people that are purchasing their products. This has also decreased because customers are thinking before customers decide to spend. In January 201 2, the Economy Review shows the GAP fell by 0.

2% in the second half of 2011.This shows that there isn’t much economic growth and that the values of most of the products manufactured in the UK don’t have a high value and also there isn’t a wide range of markets that they have already been introduced to. This can have an impact on Ionians UK because they are going to have to compete with other vehicle manufacturing companies that are outside of the XII. The economy review shows that the economy is still at a recession because the GAP has reduced and this means that there aren’t a lot of products being manufactured.

This is also having an impact on Ionians ELK because it means that they are not going o manufacture a lot of their vehicles because there isn’t a big demand of their products. This economic change isn’t going to allow Ionians UK to manufacture a lot of products because of the economic change. The economic review for January 2012 shows how inflation fell and December 201 1 and this meant that the prices of petrol fell. This is going to have a good impact on Ionians LIKE because this is going to mean there are more people are using vehicle and can also meant that more people are going to look for vehicles that are run On petrol.Ionians UK would have had to make sure that hey are able to promote their vehicles that are run on petrol because would want to get a vehicle that they are able to maintain by looking for one that has affordable fuel. Ionians UK is able to use inflation in the prices of their goods, this is because they are then able to make sure that they are taking advantage of this type of opportunity their organization, this is going to allow their company to make a profit at the time of a recession. From the economic review for January 201 2 has a graph that shows the output of the three major economic sectors: manufacturing, construction and services.

The graph shows the recession in 2008 to 201 1 and how it recovers. The graph shows that the manufacturing was a lot higher more higher in IQ in 2008 compared to the start of 2009. This shows that businesses were not manufacturing a lot of products and the way in which the manufacturing decreased within a year. This also reflects the manufacturing that Ionians LIKE did from 2008 to 2009 by making it go low because there wasn’t a huge demand for products.

This also shows that the recession had just begun and was getting a lot worse in 2009.This must have had an impact on Ionians by king their employees lose their jobs because there was less labor activity. In Q of 2009, the graph shows that there was progress being made in the economy by showing recovery. The graph shows this in the way there is a progress and this would have also impacted on Ionians I-J by improving the ways in which there is more manufacturing in their business and so this is going to make them employ more people. This is because there is a larger demand in Of their products because the economy is recovering.The economy continues to recover by manufacturing more till 201 1 . This must eave had a positive impact on Ionians UK because they are now able to employ more people into labor and they are also able to make a profit because there is more demand of their products and the economy is also recovering and more people have a lot more money so they are going to be spending. Task 1 – UP ; MI Impact of Government Policies on Ionians LIKE In this assignment I am going to identify how government policies impact Ionians K.

There are different government policies that have an impact on Ionians UK.Some of these government policies are: * Taxation * Interest rates * Exchange rates * Inflation Government policies such as taxation have an impact on Ionians XII. This is because taxation is collected from individuals and businesses.

It is collected through direct tax and indirect tax. This is going to have an impact on Ionians UK because they are going to have to pay business tax and this also means that the government is following their fiscal policy. If the government decides to increase tax it is going to slow the economy down and if the government decides to low tax it is going to speed up the economy.

If the government decides to lower taxes, then Ionians UK is able to invest money into their equines. This is going to result in a positive impact because Ionians are able to keep most of their profit and invest it into their business which is going to allow their business to grow and expand. There are many way in which the government is able use taxation to make sure that they are receiving money. Some of the ways in which the receive taxes are income tax, national insurance contributions, VAT, council tax, business rates, corporation tax and other tax. All these are a mixture of direct and direct tax.There are many ways in which taxes are bringing advantages to Ionians I-J and disadvantages. In the Government Spending 2010 review, it shows that the government had a total of Ebony coming in through different taxes.

It shows that a small amount of the money coming in was from business rates. This shows that this must have had a positive impact on Ionians UK because they are a large business and they didn’t have to pay a large amount of money for taxes in 201 0 – 201 1 This also shows that the business rates were low and they didn’t have to pay high taxes and they were able to keep most of the money their business was making.Ionians I-J is able to react to these government sections by making the most of the business tax rate being low by making sure that they are able to use that money to invest and expand their business. It is also good for their business because economy is also speeding up. The government spending review 2010 also shows that the government was receiving a lot of their money from VAT which was nearly El ban. This could have had an impact on Ionians LIKE because it meant that they had to sell their products for a higher price.

This could have resulted in people having to pay more money for their vehicle and so people will lose interest.This is ongoing to impact on them by making their potential customers to wait for the VAT to go lower so that they are able to pay the price that seems fair to them. Ionians should react to these decisions by making sure that they don’t use inflation in their process because it is going to make them lose more customers because they are not going to be willing to pay such a high price because the VAT has already inflated the price of their products.

This wouldn’t be a good idea because they already have lot competitors that are going to compete with their price by selling their vehicles at a lower price.Ionians UK is going to react to these decisions made by the government by making the prices of their motors higher. This is going to mean that people are not going to be spending as much but if they have to they would. If the VAT was low Ionians UK would react to this by decreasing the prices of their motors and this would also have an impact on spenders by making them spend more and this would also mean that the government are going to be receiving a good amount of VAT from Ionians LIKE because it would be in small amounts but it would also mean that there is a lot more customers.This also means that Ionians UK is making a profit. Government policies such as interest rates have an impact on the way customers are going to spend money. Interest rates are followed through the government policy of monetary policy. The monetary policy refers to the money supply and the levels of interest rates.

This is going to affect Ionians Auk’s customers because they are going to be able to purchase their vehicle only if they are able to take a loan from the bank. If the interest rate is high customers have less money to spend and if the interest rate is low customers have more money to spend.This shows that lower interest rate is going to have a good impact on Ionians UK because they are going to have more customers compared to the interest rate being higher when customers wouldn’t want to take a loan because they would have to pay more money back. This is also going to impact on the way in which the exchange rate is changing because if Ionians Auk’s vehicles are worth more in UK and are being exported to another European country they might not be worth as much there as they are in the K.This depends on the rate of the Euro.

If Ionians sells their vehicles in Europe and the Euro rate is higher than he pound, Ionians UK is going to make a profit and if the pound rate is higher than the Euro then Ionians UK isn’t going to make a large profit because they are based in the I-J. The interest rate has had an impact on Ionians UK. The change in government has impacted in the change in the interest rate.

When Labor was in power the interest rate was low and when the Conservatives came to power went higher.This had an impact on the way in which Ionians Auk’s customers were spending and decreased the number of customers. This is because their loan would have cost them more now that the interest rate as gone higher and this is also going to affect Ionians UK because they are a large organization that sells vehicles. Most of Ionians Auk’s customers have to take a loan from the bank whilst purchasing a vehicle from Ionians UK and if the interest rate is high they wouldn’t purchase the vehicle then but wait until the interest rate is low again.There are many ways in which exchange rates have an impact on the way in which Ionians K, for example if the vehicle is purchased by someone from a European country’ the customer is going to pay in euros. If the Euro is worth more than the pound then that would mean hat it is going to cost the European customer less because the pound rate is low. If the pound rate is higher than the Euro it is going to cost the European customer more.

Ionians UK is able to react to government decisions in the change in the interest by changing the prices of their motors.If the interest rate is high Ionians UK is able to react to this by making the price of their motors low because they would want to make sure that they are able to keep customers interested. This would also bring advantages to the customer because they wouldn’t have to take a high loan and it would also result in hem not having to pay a high interest rate. If the interest rate is low Ionians UK is able to inflate their prices because it would mean that their customers wouldn’t have to pay a high amount of interest.This would mean that Ionians UK is able to make a good amount of profit because their customer are going to be interested in their motors because the interest rate is low and they wouldn’t mind taking a high loan because they would be paying low interest for their loan. Interest and exchange rate outlook in June 2010 for Barclay shows how the exchange rates were changing and how they were planning to hanger it also shows the different ways in which the bank rates are going to change from 0. 5% in the spring in 2011.

This is going to have an impact on Ionians UK because it can either increase or decrease. This is going to have an impact on Ionians ELK because if it increases it would mean that less people are going take loans and so this is going to result in less sales and profit being made for Ionians I-J. If the interest rate decreases in spring 2011 it would mean that more people are able to take a loan to purchase a motor. In the Interest and exchange rate outlook also shows the different ways in which the exchange rate has been changing over the years.This also shows the way in which it could have had an impact on Ionians UK over the years.

There are many ways in which the exchange rate can have an impact on Ionians UK. The exchange rate can have an impact on Ionians UK in many ways. This is currently happening because the pound and Euro rate is similar at the moment. This is going to affect Ionians UK because it would mean if there are people from a European country buying a Ionians motor it would mean they are paying the exact same amount as the UK customer but in different currencies.Ionians UK is able to react to the changes in the exchange rate by changing the way in which they are pricing their motors. If the value of the pound decreases and Ionians I-J are exporting their motors internationally it would mean that Ionians LIKE is going to receive less money from these countries. Ionians UK is able to react to this change by making their prices increase; this would mean that they are able to receive more money and make a profit from other countries even though the pound rate is low. If the pound rate is high international customers would have to pay more money toIonians K.

Ionians UK is able to react to this change by keeping their prices the same. This is because they are still going to be able to make a profit because the pound rate would be high and even if Ionians UK keep their price the same because it would mean that the other countries would have to pay more for the motors. This is because their currency is lower than the pound. But if the pound and Euro currency is at a similar rate then a Ionians UK should increase the price of their motors because if it is that the Euro is a bit less than the pound Ionians UK are still able to make a profit.This will be by setting their motors prices high so that customers that are buying them in European countries are going to pay more. This is going to result in Ionians UK making a profit.

The government are also using their policy in which they inflate the prices of products and services. There are many factors that cause the government to inflate process such as VAT. The government increasing the VAT means that business are going to have to increase the prices of their goods. This has an impact on Ionians ELK because it would mean that they are going to have to inflate the price of their motors.

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