1. Test III Chapter 7 Do Voc. Chapter 7

2. Supply and Demand Law of Demand: Price Up / Demand Down Price Down / Demand Up Demand – how much will be purchased at different prices Elasticity – hope that a slightly lower price will drive up demand or fear that a slightly higher price will hurt demand Business fear a loss of market share Ex: New Coke

3. Demand Curve (see board & place in notes)

4. What causes a shift in demand? Change in incomes Price and availability of a substitute Price and availability of a complimentary good Weather / Season Change in the number of buyers Change in Style or tastes Change in expectations

5. Shift in demand curve pg. 182 (draw and label a shift in your notes)

6. Demand is Elastic if: Many substitutes Product is expensive Takes time to save for purchase Example: Autos

7. Demand is Inelastic if: Few Substitutes Inexpensive Most people will not go without the product Example: Salt or Sugar

8. Law of Diminishing Return (Law of Dim. Marginal Utility) More workers may not yield more production Consumption utility is less the more you consume

9. Supply Law of Supply – Price Up / Supply Up Price Down / Supply Down Supply Curve (see board and draw in your notes) Supply Shift (see board and draw in your notes) Price and Quantity supplied always move in the same direction

10. What causes a shift in supply? Change in the cost of production Change in the number of sellers Change in expectations for producers TechnologyTaxes

11. Equilibrium Equilibrium – where everything supplied is demanded and everything demanded is supplied Demand / Supply schedule – table listing information about price and quantity supplied or demanded Demand / Supply Curve – graph showing information about price and quantity supplied or demanded

12. Equilibrium Draw schedules and curve on board Price Floor – Agri / Minimum Wage Price Ceiling – creates shortages and a black market Example: Salaries Teacher vs. Doctors Supply and Demand along with government involvement set the prices of goods and services in America

13. Test III Chapter 8 Business Organizations Do Voc. Chapter 8 Start-ups 3 of 4 new businesses will fail in their first five years of operation

14. Three types of Business Ownership Sole Proprietorship Advantages: Easy Start-up, Your own boss, Can react quickly to market Advantages: Easy Start-up, Your own boss, Can react quickly to market Disadvantages: Unlimited liability, Limited funds, Limited potential, Blue Sky dies with the owner

15. Three types of Business Ownership Partnership Advantages: Relative easy start-up, More financial capital, Shared talents Disadvantages: Unlimited liability, Plus connected liability of partner, Limited Funds, Loss of partner could end business

16. Three types of Business Ownership Corporation Advantages: Limited Liability, Unlimited Life of a Business, Ability to raise funds Disadvantages: Expensive to start, Complicated, Double Taxation, Regulation

17. Two Types of Stock Ownership Common – voting rights, but last to get paid Preferred – first claim on dividends paid, no voting rights

18. S – Corps LLCs Government Owned Corporations: FDIC, TVA, Post Office CO-Ops Corporate Board Flow Chart (on board) Discuss Franchises / Franchise Exercise

19. Test III Chapter 9 (Do. Voc. Chapter 9) Four Types of Markets Perfect Competition Monopolistic Competition Oligopoly Pure Monopoly (see board for chart to place in notes)

20. Types of Mergers Vertical – top to bottom of production chain - example: Cooper Tire Horizontal – multiple locations doing business in a similar manner – example: Brookshires / Super 1 Conglomerate – a diversified organization doing different operations at different locations – example: TAC

21. Four Ps of Marketing Product – Settling on what the product will be (you have to find out what they want) Price – Find out what people will pay for it Promotion – Find a way to advertise it to a wide audience Place – Where and when consumers will buy it