Markets And Market Forces Flashcards
Market : definition
Any place where buyers and sellers come together to exchange products and services at a price.
Markets can be :
Local National International Physical Electric
Capital good : definition
By good used to help increase future production. The most common capital goods are property, plant and equipment. They are bough as a means of helping the production process. Industrial goods are used in a similar way but are incorporated into the final product. Eg IT server used to allow a social media company to host their customers data.
Consumer good : definition
Any goods that aren’t capital goods. They’re goods used by. Insurers and have no future productive use. Only supposed to be used by the end user, not employed as a tool to make other products.
Eg Sofa, computer, screwdriver.
Consumer markets : definition
The markets for products and services bought by individuals for their own or family use. Goods bought in consumer markets can be categorised in several ways.
Consumer no durables: summary
High volume, low unit value, fast repurchase items.
Eg ready meals, newspaper, hairdressing, any food/drink.
Consumer durables : summary
These have low volume but high unit value.
Often depivided into : a) white goods eg cooker, dishwasher, microwave. b) brown goods eg computer, games console.
The labour market : definition
Market that brings together the buyers of labour, the employers and the sellers of labour, the workers. Ie the labour market is where businesses hire workers.
Different from other markets because there are individuals and households are the suppliers and business organisations are the purchasers.
The labour force : definition
Those in employment plus those who are unemployed but actively seek work. People not counted in the labour force include fullyime students, retired people and people in prisons.
Labour intensive : definition
A business that needs more people and less machine. Eg hairdressing, house building,teaching.
Capital intensive : definition
A business relies on machinery and technology in its transformation of inputs into outputs. Eg car industry, steel production.
Unemployment : definition
Where there are people who are willing and able to work but cannot find employment at the going wage rate. Eg a machine worker who cannot get a job because there are no jobs for machine workers in the area. High unemployment, though it can be bad for local sales, can provide a business with a good source of cheap labour.
Shortage of labour can cause difficulties :
Difficult to recruit new people - prevent business from growing as fast as it wished.
Existing workers may demand higher wages because they know the business will be reluctant to release them.
Competitors try harder to poach the best staff.
The business may have to invest further in staff training and development rather than rely on recruiting new skills into the business.
Geographical mobility : definition
Can they physically get to work? This depends on the transport links as well as people’s desire to move house to get a job.
Occupational mobility : definition
Do they have the skills to do the job? This depends de on the education and training that people have. Even with A levels and GCSEs students will need more training to do many jobs.
It’s important to remember that unemployment :
Unemployment means that Human Resources aren’t being used to produce goods and services to meet peoples needs and wants.
High levels of joblessness have damaging consequences for an economy causing economic and social costs.
Unemployment problems are often bad in local and regional communities and within particular society.
How is unemployment measured ? :
(1) The Claimant Count measure includes people who are eligible to claim the Job Seeker’s Allowance (JSA).
(2) The international Labour Organisation (ILO) measure of unemployment assesses the number of jobless people who want to work, are available to work and are actively seeking employment. (Used internationally so comparisons can be made between countries and enables comparison over time).
Difference between Claimant Count and ILO :
Claimant count only includes people claiming unemployment related welfare benefits.
ILO measure gives a higher figure than the claimant count measure as it includes those who are classified as available for work but who aren’t claiming jobless benefits.
ILO may include students who are actively seeking work but don’t qualify for jobless benefits.
Second earners within a household may be reluctant to claim jobless benefits but would be classified as unemployed under the ILO measure as they’re available for work.
