economics: how the market works keywords keywords w/meaning 0.0 / 5 ? Economicskeywords (how the market works)GCSEOCR Created by: tiaaaa123Created on: 07-01-15 10:20 Productivity OUTPUT PER WORKER PER PERIOD OF TIME 1 of 11 oppurtunity cost next best alternative/what we give up when we make a choice. 2 of 11 Advantantage&disadvantage of free market Advantage: firms are efficent,because of high competition/lots of innovation. Disadvantage: People act in their own self interest 3 of 11 Advantage&Disadvantage of planned economy Advantages: necessities are cheaper disadvantage: production is not put through demand/as profits go to the state workers may be less efficent 4 of 11 Specialisation When one individual ,region or country focuses on making one good/ 5 of 11 Division of labour where the production of a good is broken into seperate tasks. 6 of 11 benefits/drawbacks to the workers of specialisation benefits: more motivation from job satisfaction/higher pay DRAWBCK: workers may become replaced w/machinery,skills might be wasted by doing one job 7 of 11 Monopoly a situation where there is only one firm/dominant firm in the market 8 of 11 Extension of demand Increase in demand due to the fall in price 9 of 11 Contraction of demand Fa;ll in demand due to the rise in price 10 of 11 3 factors affecting demand Climate,number of close substitues,taste/prefrences,fashion,advertising 11 of 11
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