Business Fundamentals 1-3 Flashcards
Why might the demand of a product change so fast overnight?
-Seasonal Factors
-Sales/promotion
-Supply chain issue
-Public/safety concerns
How would the price and supply be affected by a product?
The higher the price, the higher the quantity supplied.
3 examples to demonstrate how businesses respond to consumers needs and wants
-Product development: apples releases newer and newer phones with features based on consumers feedback
-Personalization: Nike allows customers to design their own shoes with colour, design, materials
-Service/support: Amazon has features like one-click order for convenience
Difference between essential goods/services
Goods: goods are physical objects that are supplied that are necessary for living (food, water, clothes etc)
Services: A service supplied for you that you need to live (hospital, government hydro workers etc)
What’s a luxury good/service
Goods: tangible object that you don’t need to survive (car, phone, luxury brands)
Services: Services provided for personal enjoyment (movies, sports, spa)
What’s demand and supply
Demand: people who can buy the product/how the company makes money
Supply: amount of product
2 What factors AFFECT demand
-Price: the cost of a product/service can change depending on the price. Lower prices= increase demand (vice versa)
-Marketing/advertising: effective marketing strategies can create awareness
2 things that CREATE demand
Income levels: the amount of money a person will make affects the target market of the product which creates the demand
Consumer taste: Consumer taste rangers and if your product matches a lot of consumers taste, then the demand will go high
What if Lifestyle advertising
A type of marketing that focuses on creating a connection between a product or service and the consumers lifestyle
How can Lifestyle advertising create unrealistic expectations?
-Selective highlighting: focusing on the best aspects of a product/service and ignoring the downsides
-Exaggerating Benefits: Exaggerating on the benefits and outcomes of a product making it seem more effective than it is
5 Factors that influence consumer behaviour?
Psychological, social, cultural, personal, and economic
What is conspicuous consumption?
A purchase of a good/service for the specific purpose of displaying one’s wealth
4 forms of Business Ownership
Sole Proprietorship, Partnership, Corporation, Co-operative
Sole Proprietorship
You are the business and 100% the owner
Partnership
2 or more owners of the business
Corporation
The business has shareholders
Co-operative
Business is owned and controlled by an association of members
Pure command Economy
Government dictates the level of production of goods and controls their distribution and prices
Pure Market Economy
A system in which economic decisions are made involving little government intervention
Mixed Market Economy
An organization with some free market elements with little government intervention
Which economy is Canadian
Mixed market economy
What is Privatization
The transfer of a Business or service from public to private ownership and control
5 ways businesses impact the community
-Local Jobs
-Encourage entrepreneurs
-Increase tax base
-Skill Development
-Increase technology
4 stages of business cycle
-Expansion
-Peak
-Recession
-Depression
