Miss Blackwell

Question 1

What is Demand?

Answer 1

The amount of a good/service that customers are willing and able to buy

Question 2

What is Supply?

Answer 2

The amount of a good/service that sellers are willing and able to sell at any given price

Question 3

What is the Equilibrium price?

Answer 3

The situation in a market where demand is equal to supply. i.e. Both parties are happy. Customers can buy what they want and shops have no unused stock

Question 4

What is the formula for revenue?

Answer 4

Revenue = costs - profit

Question 5

What are the factors for demand?

Answer 5

Price
Income
Number of substitutes
Price of compliments
Taste
Advertising
Population

Question 6

What are the factors for supply?

Answer 6

Price
Costs
Taxes
Subsidies
Price of alternatives

Question 7

What is elasticity of demand?

Answer 7

Measures how sensitive quantity demanded is to a change in price

Question 8

Why would a product be elastic?

Answer 8

Many substitutes

It is a luxury

Question 9

Why might a product be inelastic?

Answer 9

Few substitutes

A necessity

Question 10

What is a complement?

Answer 10

A product that is necessary for the function of another product e.g. DVD and DVD player

Question 11

What is Wealth?

Answer 11

The total assets a person owns

Question 12

What is income?

Answer 12

The amount of money a person earns from their job

Question 13

What is equilibrium?

Answer 13

The point where supply meets demand

Question 14

What are demographics?

Answer 14

The characteristics of the population

Question 15

What is tax?

Answer 15

The amount of money paid to Government

Question 16

What is a subsidy?

Answer 16

A payment from Government to increase the supply of certain products

Question 17

What is a substitute?

Answer 17

An alternate product with the same purpose

Question 18

What is competition?

Answer 18

Rivalry amongst sellers

Question 19

What is a market?

Answer 19

Where buyers and sellers meet

Question 20

What are the two types of markets?

Answer 20

Physical and non physical

Question 21

What is Market Price?

Answer 21

The price range for a product in a market at which the consumer is willing to pay

Question 22

What is Mark Up?

Answer 22

The difference between the costs of producing an item and the price at which it is sold

Question 23

What are the four types of markets?

Answer 23

Competitive market
Monopoly
Monopolistic Competition
Oligopoly

Question 24

What is a Competitive market?

Answer 24

Lots of sellers

Low prices

Question 25

What is a Monopoly?

Answer 25

Few sellers High prices - Usually except for economies of scale 25% market share

Question 26

What is Monopolistic Competition?

Answer 26

A lot of sellers Medium prices Non price differences

Question 27

What is an Oligopoly?

Answer 27

A few sellers | High but similar prices

Question 28

What is Revenue?

Answer 28

The total amount of sales

Question 29

What is Profit?

Answer 29

Capital left over

Question 30

What is Market Size?

Answer 30

The collective value of the goods/services that buyers purchase

Question 31

What is Market Growth?

Answer 31

The percentage of growth in the size of the market, measured over a specific period

Question 32

What is Market Share?

Answer 32

The percentage of total sales (by value) that a business has in a specific market

Question 33

What are Barriers to entry?

Answer 33

The factors that could prevent a firm from entering and competing in a market

Question 34

What are Barriers to exit?

Answer 34

The factors that could prevent a firm from leaving a market, even if it wanted to

Question 35

Give 5 examples of a Barriers to entry?

Answer 35

``` Large start up costs Having a marketing budget Lack of economies of scale Possibility of a price war Legal restrictions ```

Question 36

Give 3 examples of a Barriers to exit?

Answer 36

Difficulty of selling capital High redundancy costs Contracts with suppliers

Question 37

What is Market Dominance?

Answer 37

A measure of market share compared to competitors

Question 38

What is Market Power?

Answer 38

The ability of a firm to influence the conditions (i.e. higher prices) on which goods are bought and sold

Question 39

What is a Merger?

Answer 39

Where two large companies join together to form a new, larger business

Question 40

What is an Acquisition/Takeover?

Answer 40

Where control of a company is achieved by buying a majority of its shares

Question 41

What are 3 disadvantages of Mergers and Takeovers?

Answer 41

Diseconomies of scale Redundancies Higher price for customers