Economy and Marketing Today we are going to be breaking down the main ideas of economy and marketing.

Who Makes the Decisions? Controlled Economy: the government owns and controls important resources Regulated Economy: decisions are shared between the government and other groups or individuals Free Economy: resources are owned by the individuals and decision making rests solely on the individuals, no regulation Mixed Economy: some goods and services provided by the government and some by individuals There are four kinds of economy and each has their way of making decisions. In a controlled economy the government owns and controls important resources and decides what goods should be produced and in what amounts. In a regulated economy decisions are shared between the government and other groups or individuals. In a free economy, otherwise known as a market economy, resources are owned by the individuals and decision making rests solely on the individuals with no regulation. This would be the exact opposite of a controlled economy. A mixed economy is a mix of the other economies. Some goods and services are provided by the government and some by the individuals.

America’s Economy Private Enterprise: based upon independent decisions by businesses and consumers with only a limited government role Resources owned by individual producers Profit is the motive for business Consumers decide what will be purchased Consumers use value in deciding what to consume (Value: decisions to use resources toward the greatest satisfaction of wants and needs) In America’s Economy, a private enterprise is based upon independent decisions by businesses and consumers with limited or no government control. It is a business unit established, owned, and operated by private individuals for profit. In this type of system profit is the motive for business. Decisions to use resources toward the greatest satisfaction of wants and needs is called value, and consumers use that in deciding what to consume.

Consumers and Producers Consumers: individuals who purchase products and services Producers: businesses that use the resources they control to develop products and services Demand: relationship between the quantity of a product consumers are willing and able to purchase for the price Supply: relationship between the quantity of a product that producers are willing and able to produce and the price Here are some general vocabulary terms frequently used in an economy. Consumers are individuals who purchase the products and services while producers are businesses that use the resource they control to develop those products and services. Supply and demand go hand in hand. Supply is the quantity of a product while demand represents the consumers being willing and able to purchase the product for the price.

Micro and Macro Macroeconomics: economic behavior for an entire society Microeconomics: relationships between individual consumers and producers Macroeconomics is the economic behavior for an entire society while microeconomics is the relationships between individual consumers and producers.

Factors Affecting Demand Strength of want or need Availability of supply Availability of alternative products that consumers believe will satisfy their needs/wants There are many factors affecting demand. There is strength of want or need because the more consumers want or need a product the easier it will be to sell. Availability of supply that way you are able to make the products to sell. Availability of alternative products that consumers believe will satisfy their needs or wants is also an important factor affecting demand.

The Demand Curve Demand Curve: relationship between the price and the quantity demanded The Law of Demand: as the price of a product is increased, the demand will decrease and vice versa Economic Market: all the consumers who are willing to purchase a particular product or service The demand curve is the relationship between the price and the quantity demanded. The Law of Demand states that as the price of a product is increased, the demand will decrease and vice versa. An economic market represents all the consumers that are willing to purchase a particular product or service.

The Demand Curve To make a demand curve the price is displayed on the y-axis and demand is on the x-axis. The demand curve slopes downward towards the right of the chart meaning the higher the demand the lower the price.

Factors Affecting Supply Possibility of profit Amount of competition Capability of developing and marketing the products and services There are several factors that affect supply. Possibility of profit is important; the business must make sure profit is worth the initial cost. The amount of competition to see what is already out on the market. Lastly, the capability of developing and marketing the products and services.

The Supply Curve Supply Curve: a graph that shows the relationship between price and quantity Law of Supply: if the price of a product is increased, more product will be produced and vice versa The supply curve is a graph that shows the relationship between price and quantity. The law of supply states that when the price of a product increases, more will be produced and vice versa.

The Supply Curve The quantity is displayed on the y axis and the price is on the x-axis. The graph slopes upward to the right of the chart meaning as the price rises so does the quantity.

Market Price Market Price: the point where supply and demand for a product is equal The demand and supply curve are related to one another. The market price is the point where supply and demand for a product is equal as in the quantity meets both the price and demand shown in the center of the X.