Question

.What effect did the global pandemic have on budgets for business ? Explain

Answer 1

Global pandemic has affevted both the revenues and expenditure of businesses. The expected revenue of the business has decreased beacuse of lower income of the customers, layoffs, decrease in deamand for products . These are more relevant in industries producing luxury goods , or travel agencies, airlines, hotel industry, fast food etc. While if we look at the industries producing packaged foods, snacks etc, the revenue is expected to increase as people are making up stock of snacks in their house. Also the online shopping apps such as Amazon, Flipkart, Gaming apps can expect in increase in revenue as people are moving online. Now the expected expenditure has increased as it would be now costlier to move goods from one place to another since extra precautions have to be taken for safety. In factories also, the expenses on welfare of health of workers has to be increased. There are many businesses who have stocks of goods that are no more in demand at the moment. In airlines industry , we have seen that the passengers are given special suit to wear for the flight. The trains are sanitizied from time to time . Similar measures have to be taken by every business. Debt funding is expected to be increased . So there will be more interest expenses . Promotional and advertising costs will increase as the business need to assure the customers of the quality and the safety. Many business would go for home delivery of products. This would also cost more.

Hence the budget differences vary from business to business. Some are in profit while most of them.are in loss..