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economic influences - Coggle Diagram

- - - - Effects levels of disposable income eg. increase of income tax reduces sales of products and services
      - Corp tax decrease- increase businesses profit to keep, may invest
      - Corp tax increase- deter foreign companies locating in UK
    - - increase of VAT increase prices , reduce spending (housing,books and kids clothes not affected)
      - excise taxes increased, fuel and alcohol demand decreases
- - - - Sales of goods increase, out put and investment increase, new start ups, existing expand, profits rise!
      - unemployment low, more income, confident for future
      - inferior goods sales may fall, substitute normal goods
      - price may rise, demand exceeds supply
    - - sales of goods fall or grow slower
      - unemployments rise, less confident, may reduce spending
      - investment slows as expectations of growthdiminish
      - costs and prices rise slower and inflation eases
    - - sales of most goods fall, investment decrease
      - unemployment high, less disposable income,
      - some businesses fail, some cut production
      - inferior good sales increase, buy fewer normal goods (replaced) inferioir output increases
      - prices fall and inflation slowly, supply exceeds demand
      - costs may fall, resources plentiful
    - - sales rise output rises
      - unemployment falls, more income
      - investment returns
      - slight inflation as growth returns