EXTERNAL INFLUENCES REVISION QUESTIONS PART 1

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what is a market?
A market is anywhere a buyer and seller are willing to exchange goods for money
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what is competition in the market ?
some markets are very competitive and this is good for customers, but others are not and this is bad for customers
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what is perfect competition in the market?
high levels of competition in the market
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what is Oligopoly competition in the market?
several large firms dominate the market so fairly low levels of competition in the market
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What is Monopoly competition in the market ?
one large firm dominates the market so very low levels of competition in the market
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list a key feature of perfect competition
many firms competing for business
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list a key feature of perfect competition
lots of choice for the customer
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list a key feature of perfect competition
lots of products to choose from
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list a key feature of perfect competition
pressure on businesses to keep prices low
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list a key feature of perfect competition
pressure on businesses to offer excellent quality
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list a key feature of perfect competition
pressure on businesses to offer excellent customer quality
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list a key feature of perfect competition
pressure on the business to innovate
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list a key feature of monopoly competition
very little choice for the customers
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list a key feature of monopoly competition
one main product available
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list a key feature of monopoly competition
often higher prices as the business has no need to be competitive
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list a key feature of monopoly competition
business has no pressure to offer excellent quality, customer service or to spend on R & D
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list a key feature of monopoly competition
no pressure on the business to innovate
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A business that operates in a highly competitive .......
market/ environment must work incredibly hard
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list a key strategy for success in a competitive market
investing in R & D to launch new and innovate products
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list a key strategy for success in a competitive market
price cutting so they compare favourably with the competition
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list a key strategy for success in a competitive market
lots of promotion
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list a key strategy for success in a competitive market
offer excellent product quality and customer service
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list a key strategy for success in a competitive market
merging or taking over other businesses so that you are stronger in the market
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list a key strategy for success in a competitive market
creating barriers for other businesses e.g. put a patent on your products so the other businesses find it harder to copy
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What does the government want the markets to be?
highly competitive
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list one way the government helps create competition
encouraging new businesses to start up in that market e.g. targeted grants
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list one way the government helps create competition
preventing large businesses from merging and becoming monopolies- competition commission does this
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What does the environment mean ?
our natural world
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list one way businesses and households make use of the environment
it provides us with natural resources
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list one way businesses and households make use of the environment
it is something from which we get pleasure
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list one way businesses and households make use of the environment
it is somewhere to dump waste produced by businesses and households
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Is there social costs of production
yes there is
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list a example of a social cost of production
businesses can damage the environment by using up non-renewable sources
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list a example of a social cost of production
businesses can damage the environment by spoiling natural resources
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list a example of a social cost of production
businesses can damage the environment by causing congestion on the roads
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list a example of a social cost of production
businesses can damage the environment by causing pollution to the land,sea and air
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list a example of a social cost of production
businesses can damage the environment by contributing to global warming
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list an example of a social benefit of production
investing in an area and improving the appearance of the environment
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list an example of a social benefit of production
investing in new sustainable resources to replace the non-renewable ones
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What is Global Warming ?
When we burn fossil fuels as coal or oil carbon dioxide is put into the atmosphere. This creates Global Warming which means global temperatures rise. This is causing polar ice caps to melt, sea levels to rise and it might even affect growing crops
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Sustainable "green" businesses
More and more people are becoming concerned about the environment. Organisations such as pressure groups try to pressure businesses into becoming more environmentally friendly. Businesses are also under a lot of pressure to sell "green" products
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list one way to be "green"
use renewable resources rather than non-renewable ones. This means that production is sustainable, since the resources used are renewable or have been recycled
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sustainable "green" advice to businesses
businesses can do a lot to reduce the damage they cause to the environment by encouraging good practises
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give an example of green advice to businesses
switch off lights when they are not being used or install sensors that switch them off automatically when there is no one in the room
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give an example of green advice to businesses
buy suppliers from local suppliers so goods aren't transported around the world
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give an example of green advice to businesses
become more efficient so that waste is reduced
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give an example of green advice to businesses
use video-conferencing for meetings to reduce travel
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give an example of green advice to businesses
use solar or wind power to generate electricity
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give an example of green advice to businesses
reduce packaging used
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give an example of green advice to businesses
encourage staff to cycle to work
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give an example of green advice to businesses
recycle waste and buy recycled products
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give a possible benefits to the business becoming green
improved reputation
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give a possible benefits to the business becoming green
attract "green" customers
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give a possible benefits to the business becoming green
attract "green" investors
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give a possible benefits to the business becoming green
can use it to advertise and stand out in a competitive market
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give a possible benefits to the business becoming green
it helps the environment
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give a possible drawback from becoming green for the business
increased costs due to buying new technologies
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give a possible drawback from becoming green for the business
changing over from tried and tested suppliers/ ways of doing things
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Being environmentally friendly is very important to business. News about the environment, global warming and pollution etc are never far from news headlines.
Therefore it is very important that a business becomes as environmentally friendly as possible. If it does not, it risks bad publicity and action by pressure groups
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What is a pressure group?
When people do not agree with what a business is doing they may feel so strongly that they want to do something about it
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What does being ethical mean?
being ethical means being moral and having a social conscience
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list some of the problems being unethical tends to cause
damages reputation
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list some of the problems being unethical tends to cause
sales fall as customers go elsewhere
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list some of the problems being unethical tends to cause
shareholders sell their shares as they don't want to be associated with the business
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list some of the benefits a business will have from being ethical
improved image and reputation
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list some of the benefits a business will have from being ethical
ability to advertise as an ethical business
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list some of the benefits a business will have from being ethical
ability to use being ethical to differentiate from competitors
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list some of the benefits a business will have from being ethical
will attract ethical customers
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list some of the benefits a business will have from being ethical
will attract ethical investors
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list some of the benefits a business will have from being ethical
will attract ethical employees i.e. people who want to make a difference by working for a moral business
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The media and press are constantly looking out for businesses that exploit their stakeholders and many businesses have been badly caught out
once found out it is very difficult for the business to rebuild its reputation
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customers can also influence how the business behaves by how they spend their money.
The business will soon learn a lesson if customers decide to spend elsewhere or not buy a particular one of its products due to ethical issues
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What is one of the main responsibilities of the Governemnt?
help the economy to grow. That way the UK becomes wealthier and we enjoy a higher standard of living
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What are the certain things to look for when measuring if an economy is healthy or not?
economic growth, business and consumer confidence, demand for goods and services, unemployment and inflation
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Name one of the tools the government can use to help manage the economy
taxation
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Name one of the tools the government can use to help manage the economy
public spending
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Name one of the tools the government can use to help manage the economy
interest rates
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What is Growth measured by?
GDP (Gross Domestic Product)
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How does the government want the economy to grow?
nice and steadily
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In reality how does growth in an economy happen?
in cycles- sometimes the economy grows quickly, other times grows slowly
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What is a boom period?
the economy is growing quickly
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What is a recession period?
the economy is shrinking
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State one of the conditions in a boom period
confidence is high
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State one of the conditions in a boom period
demand for goods is high
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State one of the conditions in a boom period
consumer spending is high
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State one of the conditions in a boom period
businesses make more profits
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State one of the conditions in a boom period
unemployment falls
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What is the risk in a boom period?
inflation begins to rise
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State one of the conditions in a recession period?
confidence is low
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State one of the conditions in a recession period?
demand for goods falls
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Other cards in this set

Card 2

Front

some markets are very competitive and this is good for customers, but others are not and this is bad for customers

Back

what is competition in the market ?

Card 3

Front

high levels of competition in the market

Back

Preview of the back of card 3

Card 4

Front

several large firms dominate the market so fairly low levels of competition in the market

Back

Preview of the back of card 4

Card 5

Front

one large firm dominates the market so very low levels of competition in the market

Back

Preview of the back of card 5
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