The Impact of Business Activities On An Economy.


The existence of business activities in an economy is very important because of the following reasons:

MICRO- ECONOMY:

1. Individual Household: Business activities play vital role in the life of an individual by serving as a means of  income generation in meeting household needs. An individual can be self employed or a salary earner in the business sector.
If businesses don't exist, there won't be owners of Small and Medium Enterprises (SMEs), the unemployment rate will be very high.



2. Government: The existence of business activities creates the opportunity for income gener paid by business owners and their employees such as Company Income Tax, Personal Income Tax, and Petroleum Profits Tax.
Also government also involve itself in business activities through nationalization, indigenization and creation of public enterprises with the purposes of welfare creation for the citizens and income generation.
Up
 

3. Business Organizations: Business activities by the organizations serve the major motive of profit maximization.
The realized profit then enables the businesses to invest more and incur any expenditure such as payments of salaries, advertising, purchases of inventory, promotions and sponsors etc.

         MACRO ECONOMY:
 

   

The existence of business activities and organizations plays a vital role in the whole economy. If there is a decrease or non existence of business activities, the economy of a nation will melt down.

Also the rate of unemployment will also be abnormal if businesses organizations don't exist whether foreign companies, private and public enterprises.

And also it's during economic recession, entrepreneurs arise. Citizens of a country affected with recession, most times, see it as an opportunity for more innovations and development.


The Gross Domestic Product (GDP), Gross National Product (GNP) and Net National Product ( NNP).





Comments

Post a Comment

Popular posts from this blog

The Impact of Social Media in the world today.

The Impact of Social Media In The World Today  Imagine you are hearing the word social business for the first time, how will you view it in your own personal opinion. Actually, social business is a business involving social networks which is set up for the purpose of creating social services to people across the world and also serving as a means of making profit for the owners. Examples of social businesses in the world include Facebook, whatsapp, Instagram, YouTube e.t.c. These social businesses are referred to as multi billion dollar businesses as a result of a concept referred to as VVF.( Value, Volume and Frequency). Value--- The value of these social networks creates an avenue for mass usage of them by people across the world. The values they serve the world are so interesting and embracing, thus making them so attracting to the world. Volume---- The value of these social networks brings about the voluminous usage by people across the world. For instance, Facebook has over o
Read more

The Diversification of The Nigerian Economy Back to Agriculture As A Solution to Nigeria's Economic Problem.

Image
    Economy diversification; Agriculture a way out/wdn.com.ng There is no doubt that petroleum (crude oil) has contributed substantially to Nigerian revenue since its discovery in 1956 and more especially, since 1970 when its price was on the upward trend. However, it is a known fact across the globe that for a country to attain growth and development, its economy has to be diversified and that cannot occur in a vacuum. Mono-economy needs to give way to the productive development of various sectors of the economy. Following the sudden fall in the price of oil by more than 50% since June 2014 when it was $115 a barrel, which now is below $45, after five years of stability, it is a well-known fact that Nigeria’s continuous large earnings or revenue from this sector will be impossible. As a matter of fact, there is an urgent need for the Nigerian government to begin to look into diversification of various sectors of the economy so as to attain solid economic growth. Studies have sho
Read more

The Nature of Delta State Economy.

Image
Delta State is located in the Southern region of Nigeria. It's capital is Asaba which is located at the northern region of the state. Delta State is known as an oil producing state contributing 21.56-35% of the nation's oil output. The oil producing local government areas in the state include Warri North and South, Ughelli North and South, Isoko North and South, Burutu, Sapele, Ethiope East and West, Okpe and Ndokwa East and West. It has refinery and a petrochemical plant located in Warri. The most populous and commercial centre of the state is Warri, and it is located at the Southern region of the state. Apart from oil production activities, the state is also engaged into agricultural activities like fishery, forestry, veterinary, planning and research. Agricultural programs in the state include Delta Agricultural Development Program (DADP), Task Force on Communal Planning, Fishermen Farm Settlement Scheme and Tree Crop Unit. The state also involves itself into man
Read more