Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

Business A-level > Market Conditions > Flashcards

Market Conditions Flashcards

1
Q

Define market conditions

A

the relative attractiveness of the external market in which a business operates.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

What does market conditions include?

A
  • GDP
  • market demands
  • competitors
  • rate of inflation
  • business cycle
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

What is GDP?

A

GDP represents the total value of all goods and services produced within a country’s borders in a specific time period, usually a year.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

What does GDP include?

A
  • consumer spending on goods and services.
  • government spending.
  • business investments.
  • net exports (exports minus imports).
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Why is GDP important?

A
  • shows how large the economy is.
  • indicates whether an economy is growing or shrinking.
  • helps compare different countries economies.
  • used to make economic decisions by governments and businesses.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

What are the two types of GDP?

A
  • nominal GDP: calculated using current market prices.
  • real GDP: adjusted for inflation to show true economic growth.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

What is competition?

A

the success of any one business depends on its ability to match or surpass the popularity of products offered by its competitors.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Advantages of competition

A
  • improved efficiency and therefore cost effectiveness.
  • improved quality of goods and services.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Disadvantages of competition

A
  • ‘race to the bottom’ is likely to impact on quality.
  • huge resources used for marketing purposes.
  • redundancy and unemployment.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

What is the ‘race to the bottom’?

A

when companies lower cots to stay competitive.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

What are the effects of the ‘race to the bottom’?

A
  • can result in lower product quality and reduced worker wages.
  • may lead to ethical compromises.
  • short term gains but long term negative effects, eg poor working conditions.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Examples of competition

A

Costa vs Starbucks.
Nike vs Adidas.
Apple vs Samsung.
Pepsi vs Coke.
KFC vs McDonalds.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

What are examples of competitive determinants?

A
  • equipment and technology
  • operational procedures
  • use of marketing mix
  • research and development
  • financial planning and control
  • incentive schemes for staff
  • quality procedures
  • staff skills, education and training
  • enterprise/entrepreneurial skills
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

What is demand?

A

how much of a good or service a customer wants and is able to purchase. for a business, demand turns into revenue (sales).

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

What factors influence demand?

A
  • price of product
  • price of other products
  • tastes and fashion
  • government position and priorities
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

How could a business change their target market?

A
  • advertising
  • changing price range
  • changing quality
  • locations
  • celebrity endorsement
  • new products
17
Q

What is the effect of changing income levels?

A

changes in income are likely to make only minor impacts on business costs, compared to the effect on the demand for goods and services.

18
Q

What are the two types of income?

A

nominal income and real income

19
Q

What is nominal income?

A

the income you receive without any adjustments for inflation. its the raw number, the actual amount of money you get.

20
Q

What is real income?

A

the income you have, adjusted for inflation. it tells you how much your money can buy.

21
Q

What factors other than household income affect customer spending (demand)?

A
  • real disposable income
  • employment and job security
  • household wealth
  • expectations and sentiment
  • market interest rates
22
Q

How does an ageing population affect demand?

A

greater demand for services to support older people, eg healthcare. increasing disposable incomes of older people reflected in higher demand for goods and services, eg holidays.

23
Q

How does immigration affect demand?

A

higher costs of (but higher demand for) public services, eg education, healthcare, housing. increase in size of labour force - potentially keeping wage rates low.

24
Q

What are the key factors that affect real income?

A
  • interest rates
  • price inflation
  • wage growth
  • employment levels
  • government tax policy

Business A-level (23 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions