Business: Chapter 2

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Business: Chapter 2
2015-06-30 15:08:08

chapter 2 review
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  1. The study of how society uses scarce resources to produce and distribute goods and services
  2. The sub area of economics that focuses on individual parts of the economy such as households and firms
  3. The sub area of economics that focuses on the economy as a whole by looking at aggregate data for larger groups of people, companies or products
  4. Economic Concerns
    • What is produced?
    • How much is produced?
    • How is it produced?
    • For who is it produced?
  5. Resources used to create products
    • Natural resourcesĀ 
    • labour
    • capital
    • knowledge
    • entrepreneurship
  6. Primary Economic System
    • market economies
    • command economies
    • socialism
    • mixed economics
  7. Factors owned allocated by the marketplace
    Market Economy
  8. Factors owned and allocated by the government
    Command Economy
  9. Factors owned or controlled by the government in major industries
  10. What is Perfect Competition?
    • large number of firms and marketĀ 
    • sell similar product
    • buyers and sellers have good information about prices, supply etc.
    • easy to open or close businesses
  11. What is Monopolistic Competition?
    • many firms in the market
    • firms offer products that are close substitute but still different
    • easy to enter market
  12. What is Oligopoly?
    • a few firm produce most the outputĀ 
    • large capital requirements limit the number of firms
  13. What is Pure Monopoly?
    • A single firm accounts for all industry
    • a firm is the industry
    • prevent new firms from entering
  14. The 4 Markets
    • Perfect Competition
    • Monopolistic Competition
    • Oligopoly
    • Pure Monopoly
  15. The quantity of product that people are willing to buy at various prices
  16. The quantity of product that business will make available for purchase
  17. The quantity of product demands equal the product supplied
  18. Changes in Demand
    • changes in customer income
    • changes in fashion or taste
    • changes in price of related products
    • expectations about future prices
    • change in the number of buyers
  19. Changes in Supply
    • new technology
    • change in price of resources
    • change in price of related products
    • change in number of producers
    • change in taxes