Markets Flashcards
What is perfect competition?
-homogenous products
-lots of buyers and sellers
-lots of firms
-no entry/exit barriers
-no control over price
-e.g. agriculture
What is monopolistic competition?
-differentiated products
-many firms
-little price control
-few entry/exit barriers
-focus on advertising
-e.g. gyms and takeaways
What is oligopoly?
-standardized but differentiated
-few large firms
-significant entry/exit barriers
-interdependent on other businesses for price
-e.g. supermarkets
What is monopoly?
-unique product
-one firm
-considerable control of price
-PR advertising
-very high entry/exit barriers
-e.g. royal mail
What is a market?
place where buyers and sellers meet for mutual exchange of goods or services for money
Advantages and disadvantages of global markets
cheaper production, larger market, more customers, exiting saturated UK market
risk of economic and political instability, high levels of competition, different legislation
What are mass markets?
goods targeted at everyone in target population, access to more customers increasing profit, high levels of competition, benefit from economies of scale
What are niche markets?
specialized goods and services, higher prices, less competition, targets a small section of larger market
What is involved in trade markets?
sale of goods/services to another business, increases the likelihood of sales
What are seasonal markets?
seasonal levels of demand, changing stock , plan ahead to minimize impacts on cash flow
What is market data?
collect about competition and consumers, consider relevance, risk of overload
What is market share? Formula?
measure of percentage share a business holds over market they operate in
total sales / market sales x 100
What is market size? Formula?
total amount of sales in a market measured in terms of value or volume
number of sales in industry x price
Market segmentation
-demographic (gender, age)
-geographical (regions of the country)
-psychographic (culture, lifestyle)
What are the benefits of market segmentation for the customer?
-product reaches expectations
-fits with budget
-value for money
-help stick to desired principles
