An example of a external cost.
Cost of land
Cost of construction
Labour costs
Pollution
An example of a external benefit.
Jobs will be created
Why might a firm not respond to pressure group activity?
Well organized and funded
The cost to the business of changing its methods is more than the possible cost of poor image and lost sales
They have public support and in the media
Consumer boycotts cause reduced sales
In cost benefit analysis, when will the government probably refuse permission for a project?
When the social benefits is greater than the social costs
When the social benefits is less than the social costs
When the social benefits is equal to the social costs
Which one is a pressure group?
SAARC
Greenpeace
WWF
ASEAN
Which of the following given below is not an instance when pressure group is less likely to change business actions?
They have popular public support.
Consumer boycott result in much reduced sales
Group is well organized and financed
What the firm is doing is unpopular but not illegal, such as testing drug on animals.
Define cost benefit analysis.
The financial gains made by a business as a result of a business decision
The provision of a product or a service to satisfy consumer wants and needs
The income to a business during a period of time from the sale of goods or services
The valuation by a government agency of all external and private costs and benefits resulting from a business decision
An example of a private benefit.
Money made from the sale of products
Other firms may move into the area to provide services to the firm.
Important products will be produced to benefit the society.
The costs paid by the rest of society, other than the business, as a result of a business decision.
External cost
Private cost
Social cost
Total cost
Which one of the following given below is not an external constraint of business?
Technological change: New products.
Technological change: New production processes.
Employees problems
Environmental issues.
