1.5.4 The economy and business - Word Drop

The economic climate is made up of factors that affect how well the economy grows. One factor is ______, which is the number of people willing and able to work but without a job. High unemployment can reduce ______, the money people receive from work and investments, so demand for many products falls.

______ is a sustained rise in the general price level. Rising inflation increases business ______ as inputs become more expensive and can reduce customer spending. A change in ______ alters the cost of borrowing. Higher interest rates can make firms delay new ______ projects, because loans cost more.

Taxation is a way government raises ______ by charging people and businesses. Higher corporation tax reduces the ______ a business keeps after tax. A tax added to the price of most goods and services is ______, which can raise prices for customers. Exchange rates show the value of one ______ against another. A stronger pound makes exports more expensive and imports ______ for UK businesses.