Question

Economic forces impact the opportunities available to entrepreneurs. Which of the following alternatives reflects a set of economic forces that would be of interest to entrepreneurs?1. Level of disposable income, new uses of old technologies, and new laws and regulations2. New technologies, consumer spending patterns, and new laws3. Interest rates, consumer spending patterns, and level of disposable income4. Social and cultural trends, level of interest rates, and what people think is "in"5. New changes in political areas, new laws, and level of disposable income

Answer 1

Answer:

3. Interest rates, consumer spending patterns, and level of disposable income

Explanation:

The following alternatives reflects a set of economic forces that would be of interest to entrepreneurs: Interest rates, consumer spending patterns, and level of disposable income

1. Interest Rates: Whenever there is an increase in interest rates, entrepreneurs are required to set aside more funds for the repayment of loans in the sense that the interest component becomes more expensive and looking at the total picture, the loan becomes technically bigger than what they had collected. This occurrence of higher interest rates reduces the business' net income for all periods till the loan is fully paid.

2. Consumer spending patterns: Consumer spending patterns are a very important tool or dataset for businesses which can be used to understand market potential. It reveals customers who are likely to buy certain categories of goods and services and where they are geographically located. Without this information businesses could be located in the wrong places or could target the wrong customers

3.  Level of disposable income: Disposable income refers to the amount of income left after taxes are paid. This metrics is important for businesses because that is the fraction of earnings that consumers spend on to buy goods and services.The higher the disposable income, the higher the demand for firms products will be.