B300 B: Business Behavior in a Changing World II

Running Head : BUSINESS BEHAVIOUR IN A CHANGING WORLD II

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The government participates in the control of business activities to ensure that there is an overall growth in all sectors of the economy . It implements policies that are geared towards achieving high levels of employment , continuous growth in GDP and controlling the levels of price stability . These policies are either fiscal or monetary depending on the desired change it expects to achieve . Fiscal policies involves the adjustment of interest rates and tax rates while

monetary policy entails the controlling the money supply in the economy . Employment of these policies affects the overall level of growth and stability in the economy . The government also aims to regulate and control business activities in the economy . It exercises control of the private sector in achieving social goals and to provide essential services i .e . education and health that may require huge amounts of capital outlay . If left to the private sector , exploitation may occur through increased pricing . It is also mandated with provision of financial assistance to individuals and firms in form of loans

Business activities need a well drawn environment where certainty and desired goals can be achieved . The social , political and environmental aspects should be in balance to minimize risks and to promote socialism through elimination of negative aspects of capitalist ideologies . It is the role of the government to provide regulations that will guide business conduct to encourage investment . Although it is necessary , the participation...