MS-11 Question 1

Explain how political-legal factors present an opportunity as well as threat to a particular industry or a business organization. Illustrate with the help of an example.

Political (incl. Legal)
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Tax policieswhat tax hinder the business and what taxes incentives are available]
[ if the tax policies are liberal / incentivated, businesses will addexpansion ANDif the tax policies are harsh/ harmful to the business,it will reduce its activitiies.]
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-International trade regulations and restrictions
[ does the government encourage exports / with high tariffs on imports]
[ if the exports policies are liberal / incentivated, businesses will addexpansion ANDif the export policies are not encouraging, the cos. will notgo for export development ]
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-Employment laws][ is the government encouraging skilled immigrants with temp. permits]
[if the government relaxes the rules on skilled migrants,which means THE EXPANSION OF THE BUSINESS ANDif the skilled immigrants are restricted, the business willreduce its activities ]
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-Interest rates & monetary policies[ are the interest rates under control / is there a sound monetary policies]
[ if the interest rate goes down/ the monetary policies are liberal, as the demand goes up, businesses will addexpansion ]AND[ if the interest rate goes up , the demand will go down businesses will downsize / cut cost ===================================================-Government spending[is government spending is significant and is it under control ]
[ if the government increases the spending on infrastructures etc, the demand goes up , businesses will addexpansion ]ANDif the government reduces spending , it will have negativeimpact on business.]==================================================-Unemployment policy[what is the employment / unemployment policies of the government ]
[if the employment goes up, there will be more demandfor the products/services and hence the business will expandand vice versa.]
=====================================================-Taxation[ has the taxation encouraged the industry ]
[ if the taxation policies encouraged the industry, businesses will addexpansion ]ANDif there is no relaxation in the taxation policy,the business will reduce its activities
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New inventions and development
[ are new inventions being encouraged for developments by the government]
[ as more inventions are brought out, more jobs are created, demand for product/services will go up, businesses will addexpansion ]ANDif there are no encouragements, the business will reduce its activities.]======================================================
Rate of technology transfer
[ is the rate of technology transfer is speeded up by the government]
[ as the rate of technology transfer speeds up, more jobs are created, demand for product/services will go up, businesses will addexpansion ] ANDVICE VERSA.