Assignment

On

An Analysis of Economic Environment

-A Case Study on Bangladesh-

[The assignment is prepared for the requirement of the course Strategic Management (MGT-
5405) of MBA 4th Semester]

Prepared For:
Prof. K.M.Golam Mohiuddin
Course Instructor

Prepared By:
Group :E
Asfia Binte Osman R103412
Luthfunnahar Sharmin R103411
Shamima Akther Shifa R103413
Tanjuma Ahmed R111407
Semester: Spring, 2011
Level: RMBA 4th Semester, Female (B)

Submission Date: 11/02/2011

Department of Business Administration

INTERNATIONAL ISLAMIC UNIVERSITY CHITTAGONG
 An analysis of Economic Environment of Bangladesh through some
Economic Indicators:
Economic Year
Indicators 2005- 2006- 2007- 2008-2009 2009-2010
2006 2007 2008
1.GDP growth 6.6% 6.4% 6.2% 5.8% 5.5%
2.Inflation 7% 7.2% 9.9% 7% 6.5%
3.Per capita $523 $599 $608 $690 $780
income
4.Foreign $3484 $5077 $6149 $8471 $10,340
exchange
reserves(in
millions)
5.Savings as % of 20.3% 20.4% 20.1% 30.21% 32.37%
GDP
6.Investment as a 25% 24.5% 24.2% 23.7% 24%
% of GDP
7. Balance of $-0.4 $1.0 $1.4 $1.39 $2.15
Payments (in
billions)
8.Market $3035 $3610 $6793 $6670 $7067
capitalization(in
millions)
9.Budget deficit 3.65% 3.2% 3.7% 3.9% 4%
as a % of GDP

Definition of Economic Indicators:

 GDP Growth Rate:

The Gross Domestic Product (GDP) is the total market value of all final goods and
services produced in a country in a given year, equal to total consumer, investment and
government spending, plus the value of exports, minus the value of imports.

 Inflation:
Inflation is a rise in the general level of prices of goods and services in an economy over
a period of time.

 Per Capita Income:

Income per person in a population. Per capita income is often used to measure a country's
standard of living.
 Foreign Exchange Reserve:
Deposits of foreign currency held by a central bank. Holding the currencies of other
countries as assets allow governments to keep their currencies stable and reduce the
effect of economic shocks. The use of foreign exchange reserves became popular after
the decline of the gold standard.

 Saving:
Saving is income not spent, or deferred consumption. Methods of saving include putting
money aside in a bank or pension plan. Saving also includes reducing expenditures, such
as recurring costs. In terms of personal finance, saving specifies low-risk preservation of
money, as in a deposit account, versus investment, wherein risk is higher.

 Investment:
Investment is putting money into something with the expectation of profit. More
specifically, investment is the commitment of money or capital to the purchase of
financial instruments or other assets so as to gain profitable returns in the form of interest,
income (dividends), or appreciation (capital gains) of the value of the instrument.

 Balance of Payment:
A balance of payments (BOP) sheet is an accounting record of all monetary transactions
between a country and the rest of the world.[1] These transactions include payments for
the country's exports and imports of goods, services, and financial capital, as well as
financial transfers.

 Market Capitalization:
Market capitalization (often market cap) is a measurement of size of a business enterprise
(corporation) equal to the share price times the number of shares outstanding (shares that
have been authorized, issued, and purchased by investors) of a publicly traded company.

 Budget Deficit:
Budget Deficit is The amount by which a government, company, or individual's spending
exceeds its income over a particular period of time. also called deficit or deficit spending.
It is Opposite of budget surplus.