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Factors that justify the existence of small scale firms in an economy are;Small capital. some businesses remain small because of limitations of investment funds.Where the market served is small. The market demand in a particular industry could be too small that it cannot accommodate large scale firms.If the government demands so. The law may restrict the growth of firms.Products that are designed to meet customer specification. There are services that require personal attention entrepreneurs that invest in such firms are compelled to operate them in small scale.Desire to retain control by the owner. There are entrepreneurs that start firms and leave them to remain small for fear of loss of control and independence in management if the firm becomes large scale.Rising costs of production. Some firms that would want to remain small because of fear of increasing cost of production with increase in its level of production.Risk of large scale enterprises. There are huge risks that face large scale enterprises despite the many benefits that accrue to it. To avoid such risks, firms may opt to remain small scale.Expensive goods. Firms that are engaged in the production and sale of expensive and sell specialized goods are of small scale because the products they are dealing with are too expensive to call for mass production.Quick decision making. In cases where the proprietors want to avoid delay in decision making, they may opt to maintain a small business as it may require less consultations.Simplicity of small firms. To avoid bureaucracy and complexities associated with large scale firms, a proprietor may want to remain small scale.
Some of negative implication of inflation in an economy are;Reduced profits Because increase in price will lead to reduced sales volume.Wastage of time because individuals may waste time shopping for reasonable prices/firms may waste time adjusting their price lists.Conflicts between employers and employees that lead to strikes because employees will demand high pay but the employers will be reluctant.Decline in standard of living because consumers purchasing power decreases.Loss to creditors because they receive payment for credit transaction when money has lost value.Retardation of economic growth due to reduced savings and investment.Loss of confidence in the monetary system as a medium of exchange and store of value.Adverse effects in balance of payment because exports become expensive relative to imports.
Benefits of Perkerra irrigation scheme to the Kenyan economy include;Offers employment opportunities to many people in the farm/mills earning them income hence improving their living standard.Increased food production - The scheme contributes to the bulk of Kenya's rice thus saving some foreign exchange that would have otherwise been used to import rice.Settlement - The scheme has provided land fore settling the landless who lacked farms before.Successful control of floods that were a menace before through construction of dams/reservoirs.Led to effective use of land that was initially barren hence enhancing food security and eradicating poverty.Creation of amenities such as schools, churches, hospitals that have been provided thus improving the living standards.Infrastructural improvement as roads have been built linking the farms to the markets Which have in turn opened up the otherwise remote areas for development.
Contributions of mining industry to economy include;Generate revenue used to finance development.Attracts development of transport and communication network.Contributes to urbanization as towns develop near mining areas.Creates employment opportunities to miners.Enhances development of mineral processing industries and other industries.
Advantages of advertising to the business include;Creates awareness of the firm's products to the potential customers especially if the firm is new/the product is new on market.Help increase sales volume of the firm that translates to higher profit.Popularize the firm products and this encourage frequent use of the productReminds the consumer about continued existence of the firm's products. This enables the firm to maintain its market share.Inform the customer about changes in price/quality.Upholding the image/reputation of the organization.