Question

1. Explain in detail the importance of Political, Social, Economic and Cultural factors of a country.
2. Explain how Covid-19 have impacted these factors globally

Answer 1

Dear Student,

1) Political Factors

These included mobilizing available public resources to augment what private citizens are doing to help the poor and vulnerable; working on some of the national macro-economic levers to sustain businesses; and discussing with international creditors about cancelling – or rescheduling – repayments, of some of their debts

2) Cultural Factors

Trade will also be affected by changes in production patterns. Over the last two decades the thrust for improved efficiency and productivity has driven manufacturing, as well as many service industries, towards minimizing costs

3) Socio-Economic Factors

budget deficits accumulate into government debt, and current account deficits accumulate into foreign debt. The model imposes an intertemporal budget constraint on all households, firms, governments, and countries. Thus, a long-run stock equilibrium obtains through the adjustment of asset prices, such as the interest rate for government fiscal positions or real exchange rates for the balance of payments

6) High Expenses on Medical Services

The combination of trade and monetary problems emanating from Europe and the USA will put severe strain on Governments in developing countries which are already battling with soaring medical costs, pressing demands to provide emergency assistance to the poorest sections of the population, and assistance to bail out faltering firms.

5) Social Factors

nominal stickiness caused by wage rigidities, lack of complete foresight in the formation of expectations, cost of adjustment in investment by firms with physical capital being sector-specific in the short run, monetary and fiscal authorities following particular monetary and fiscal rules.

Below are the industries those goods / service demand and supply are badly affected due to Corona virus

Coronavirus has a mixed impact on tech companies. With work-in-isolation policy being a mandate for employees, there are companies that make the most of it in terms of profit. For example:  

1) IT Companies

Slack Technologies Inc. confirms that due to the global fallout from COVID-19, there is a surge of interest in workplace-collaboration software.Zoom, an enterprise video communication solution is one of the most downloaded business apps in the US on Apple Store in the 2nd week of March 2020 (according to App Annie).

2) Insurance

The rise of coronavirus cases may end up with the demand for certain insurance types. As the COVID-19 virus continues to dominate the headlines, there is a hike in demand and awareness about insurance plans for health and life coverage.

3. Sports & Entertainment

Movie theatres are temporarily locked down in parts of India, amidst the COVID-19 spread.

4.Travel & Tourism

Airlines are drastically cutting flights and flight rates as more people have decided not to fly during the outbreak. According to the International Air Transport Association (IATA), global airlines may lose $113 billion in sales if the coronavirus continues to spread at this pace.

* Agricultural commodity market

1) Reduced demand

Reduced demand for commodities like corn, beef, wheat, timber and vegetable oil can alleviate pressure on forests, and extractive industries are less likely to invest in exploration or new projects during a recession. The precipitous decline in oil prices this year, for example, has already cut exploration budgets in Brazil by 20%.

2) Decrease in price

Food and Agriculture Organization said that food prices have dropped overall, including a 12% decline in the vegetable oil price index.

3) Loss of Export Business

“Eventually, there will be less commodity-led agricultural deforestation and timber-led forest degradation, as aggregate demand in export markets is reduced.Also the export business in vegetable sector also impacted drastically

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