F1Accountantinbusiness课程F1-ch4

Inputs: materials, money, men, machines, management Organization: people, objectives, structure and management
3. The concept of a market
• Definition A market is a situation in which potential buyers and sellers of a good or a service come together for the purpose of exchange.
• Price theory and the market Price theory is concerned with how market price for goods are arrived at through the interaction of demand and supply.
4. The demand Schedule
Comment
-1
Perfect complements
-ve
Complements
0
Unrelated
Ve
Substitutes
1
Perfect substitutes
2.Micro and Macro environment
• Macro environments We can use PEST to analyze the macro environments
Hale Waihona Puke • Micro environments
Inputs
Organization
Outputs
Competition
4. The demand Schedule
• The price elasticity of demand
Price elasticity explains the relationship between change in quantity demanded and changes in price.
• Definition Demand for a good or service is the quantity of that good or service that potential purchasers would be willing and able to buy, or attempt to buy, at any
F1 Micro economic factors
1. The micro-environment
Definition
The micro environment refers to the immediate operational environment including suppliers, competitors, customers, stakeholders and intermediaries.
Price elasticity of demand (PED) = Percentage change in demand/ percentage change in price.
• PED>1, elastic ; PED<1, inelastic
4. The demand Schedule
• Income elasticity of demand
1. The micro-environment
Elements of micro-environment
Suppliers, competitors, customers, stakeholders (interest groups) and intermediaries.
The micro environment contains both the actual and potential groups related to the company, the competitive environment should be include.
4. The demand Schedule
• Substitutes and complements
Substitutes goods are goods that are alternatives to each other.
Complements are goods that tend to be bought and used together.
possible price.
• The demand curve Demand falls as price increases. Demand rises as price falls.
4. The demand Schedule
• Factors determining demand for a good
Income elasticity of demand (IED) =Percentage change in demand/ percentage change in income.
IED<0---- Inferior goods 0<IED<1, inelastic----Necessities IED>1, elastic----Luxury goods
4. The demand Schedule
• Cross elasticity of demand
Cross elasticity of demand=% change in demand of good A/% change in the price of good B
Cross elasticity
a. The price of the good b. The size of income c. The price of substitute goods d. Tastes and fashion e. Expectation of future price changes f. The distribution of income