Business environment of the Maldives

Topics: Economics, Monopoly, Microeconomics Pages: 18 (3723 words) Published: November 8, 2014


Abstract
Any business involves people and resources either to produce items or goods to be sold, or provide services to be sold (BPP, 2010). Through learning, researches and activities, it is clear that different organizations response to their business environment in a unique different way. The competitive market leads to structure such as oligopoly where many buyers and sellers involve in trade of similar products making average profit. The non-competitive market structures leads to monopoly with high barriers controlling new entrants, and with equilibrium profit or higher monopoly profit. Market forces affect organizational responses to supply and demand, where those responses and behavior are shaped via cultural environment such as economics, socio-culture, technology, etc. In this regard if business is successful or finds it slow in expansion, it may consider globalization via international trade. In this report, the consequences of globalization and impact of EU policies are studied and analyzed in arriving conclusion.

Contents
Abstractii
Introductioniv
Organizational behavior in their market environment1
Market structure1
The Maldivian market structure2
How market structure limits the pricing and output decisions of organizations2 Market forces and organizational responses3
Market forces in the Maldives and how it shapes the responses of organizations4 How the business and cultural environments shape the behavior of MWSC6 Political environment:6
Economic environment:6
Socio-cultural environment:7
Significance of the global factors that shape national business activities9 International Trade:9
Significance of international trade to UK business organizations10 Market Opportunities:10
Global Growth:10
Impact of the European Union policies on business organizations10 Competition policy11
EU Growth Program11
Conclusion13
References14

Introduction
The combination of internal and external factors such as: competition; clients and suppliers; improvements in technology; laws and government activities; and market, social and economic trends that influence a company's operating situation, is known as business environment. In its environment, buyers and sellers interacts differently forming various competitive and non-competitive structures - monopoly, oligopoly, perfect competition, monopolistic, etc. The basic analysis of different types of markets remains the same, as the quantity demanded refers to the quantity of a good or service that households are willing and able to purchase at a particular price - the effective demand. People would like to own luxury items that they could not afford – making the demand ineffective. Pricing decision of organizations are influenced by the behavior of its competitors and the market forces within the environment. Professor Michael Porter’s “Five Forces Model” in 1980 identifies those factors which are likely to affect an organization’s competitiveness. This simple, but powerful tool undermines where power lies in any business situation. These forces can create threats to marketers. Also they generate opportunities for new products and new methods of reaching customers. In the event of slow market growth, regulatory obstacles or market saturation, organizations consider factors like industry analysis, ways of exporting, etc., to go global. UK organizations are known international traders, influenced by free trade policies of European Union. The persistent inability to get a grip on the current “euro crisis” has led international attention to focus on Europe not as a promising market of tomorrow, but as a potential source of turbulence in the months and years to come (Balcerowicz, 2013). Though the policies have its disadvantages, most organizations take advantages of social, employment, environment and competition policies as granted. This report is made through research of scholarly articles, published and downloadable e-books....
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