Economic Factors Affecting Business

Economic Factors Affecting Business

These are a small elaboration of the major economic factors affecting business organizations. Internal environment, operational environment and external environment are 3 major classes of such factors. The following list is however a comprehensive and integrated list of all possible economic factors that affect the working of business organizations. Income, inflation, recession, interest rate and exchange rate.

Demand and SupplyThe demand and supply are two principal factors that affect the working of any business model. The demand is the will and ability of consumers to purchase a particular commodity and the supply is the ability of the business to provide for the demand of consumers. It must be noted that all the factors that are included in this list are inter-connected. You may also read demand and supply analysis.

Marginal and Total Utility Utility is the amount of satisfaction, that is derived by consumers from consumption of goods. It so happens that after continuous and successive consumption of units of the same goods, the satisfaction