The Business Environment

The Business Environment

Business is the main component in the world today. Everything you can think of relates to the economy is business in some form or fashion. Without business, we would have to depend on ourselves for everything. We would have to find our own food, shelter, etc. The economy of the country depends on businesses for employment and livelihood in general. These businesses produce services that we rely on in our everyday life. Businesses pay taxes to the government which allows the government to function on the taxes collected from them. Since 2008 the economy has taken a turn for the worse and all businesses big and small have taken a huge hit. Hopefully, over time the economy will become more stable again. I couldn’t imagine the world without business.

Since the economy has hit rock bottom, it is now up to the government to step in and try to take a fiscal or monetary policy approach. Fiscal policy is when the government try to seduce the economy through taxation and spending decisions that are created to encourage growth, increase employment, and decrease inflation. Monetary policy is when the government manages the money supply, by targeting interest rates in an effort to promote economic growth. In my opinion I really do not see the fiscal policy being pushed to its maximum potential. Due to the economic decline, I feel like more of the monetary policy is being pushed. Especially, when dealing with credit card interest rates. It’s more difficult to obtain a loan or to start a new business. The lending institutions are not so eager to give a helping hand. I guess I can’t really blame them because they had to receive a bail out from the government.

A sole proprietorship is a business entity that is owned and operated by an individual owner and there is no distinction between the owner and the business. The disadvantage of a sole proprietorship is if you have a dispute with someone they can freeze your...