AS Business Studies F291 (The Market) 0.0 / 5 ? Business StudiesASOCR Created by: MichelleCreated on: 13-05-13 17:02 Define microeconomics? The study of individual consumers, busnesses and markets 1 of 14 How is market price relevant to a business? All businesses have competitors, market price affects a business's mark-up 2 of 14 How is market price determined? Demand, supply and equilibruim price 3 of 14 What is the equilibrium price? The situation where the demand and supply is equal 4 of 14 What factors affect demand? Price, income, wealth, advertising, trends, demographic changes, government action and price of other goods! 5 of 14 What is a substitute? An alternative product that serves the same function 6 of 14 What is a complement product? A product that is brought in conjunction with another 7 of 14 What factors determine supply? Price and costs 8 of 14 What is subsidy? A payment from the government to encourage a business to increase supply 9 of 14 Explain elastic Where the change in demand or supply that results from a price change is greater than the change in price that caused it 10 of 14 Explain inelastic Where the change in demand or supply that results from a price change is less than the change in price that caused it 11 of 14 What is meant by a competitive market? Competition between business - this keeps prices down and encourages innovation 12 of 14 What is a monopoly? A market controlled by a single business - the leading firm is known as a monopolist 13 of 14 What is an Oligopoly? A market dominated by a few large firms 14 of 14
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