the competitive environment Flashcards
why might someone buy shares in a company?[2]
because they might be passionate about something like e.g. football
or to gain control of the company
what is meant by the term competition?[1]
when more than 1 business is attempting to attract the same customers
what is meant by the term risk?[1]
the possibility of something going wrong
what is meant by the term recession?[1]
when the value of an economy’s output goods and services falls for 6 month or longer
what is meant by the term monopoly?when does a monopoly exist? [2]
a market which is dominated by one seller or producer.
A monopoly exists when a business does not face any competition in a particular market.
by law, when does a monopoly occur? [1]
a monopoly occurs if a firm has a market share of 25%.
why is tying to compete with a business that has a monopoly very difficult? [1]
they can dictate prices.
what is a competitive market? why are markets competitive? [2]
a situation where multiple businesses compete for the same customers.
They’re competitive because businesses that sells goods and services face rival who are selling similar goods and services.
why is branding important for businesses? [1]
the design and reputation of a brand can increase the appeal
A market can exist where there are ______ and _______.
They come together to ________ and set ______ for _____ and ________. [3]
A market can exist where there are buyers and sellers.
They come together to exchange and set prices for goods and services.
what is the level of competition for lots of small businesses? For example, restaurants. [3]
-products can be similar or different from each other.
-low prices
-competing of: advertisement, high-quality service and convenient locations.
what is the level of competition for a few larger firms?
For example supermarkets, phone manufacturers (e.g. apple) [3]
-products will be different or advertised to appear as if they’re different
-high prices
-competing for: advertising, launching new products
what is the level of competition for a single business (monopoly). For example, water supply.[3]
-only 1 main product is available
-high prices
-little o no direct competition
Businesses selling in markets made up of many small firms may compete on _____, especially if they provide _______ products.
Painters and decorators, for example, may try to keep prices to a minimum to give an advantage over ______.
In other cases, prices may ____ because the products sold are _________. [2]
Businesses selling in markets made up of many small firms may compete on price, especially if they provide similar products.
Painters and decorators, for example, may try to keep prices to a minimum to give an advantage over rivals.
In other cases, prices may vary because the products sold are different.
how would smaller coffee shops try to compete with multinational rivals? [2]
by providing something different.
e.g. a distinct range of products or very high standards of customer service.
