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MARKETING BEGINS WITH ECONOMICS
CHAPTER 03 4/17/2017 MARKETING BEGINS WITH ECONOMICS 3.1 Scarcity and Private Enterprise 3.2 Observing the Law of Supply and Demand 3.3 Types of Economic Competition 3.4 Enhancing Economic Utility © South-Western Publishing MARKETING
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SCARCITY AND PRIVATE ENTERPRISE
GOALS for Lesson 3.1 Identify the basic economic problem. Describe how America’s private enterprise economy works. © South-Western Publishing
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The Importance of Economic Understanding
The basic economic problem Who makes the decisions? Controlled economy—government Regulated economy—shared Free economy—individuals Mixed economy—shared by government and private enterprise © South-Western Publishing
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America’s Private Enterprise Economy
Characteristics Consumers Producers Government Economic forces © South-Western Publishing
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OBSERVING THE LAW OF SUPPLY AND DEMAND
GOALS for Lesson 3.2 Explain microeconomics and concept of consumer demand. Identify factors that affect supply and its relationship to demand. © South-Western Publishing
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Macroeconomics Macroeconomics studies the economic behavior and relationships of the entire society. © South-Western Publishing
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Microeconomics Microeconomics is the study of relationships between individual customers and producers. © South-Western Publishing
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Microeconomics and Consumer Demand
Factors affecting demand Analyzing demand curves Demand curve Law of demand Economic market © South-Western Publishing
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Demand Curve for Movies
Price $10.50 9.00 7.50 6.00 4.50 3.00 1.50 1,000 Quantity 2,000 3,000 4,000 5,000 6,000 7,000 © South-Western Publishing
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Supplying the Product Handling the competition Analyzing supply curve
Law of supply © South-Western Publishing
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Supply Curve for Watches
Price $105 90 75 60 45 30 15 10,000 Quantity 20,000 30,000 40,000 50,000 60,000 70,000 80,000 © South-Western Publishing
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Intersecting Supply and Demand
Market price © South-Western Publishing
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Demand Curve for Notebook Computers
Price $2,100 1,800 1,500 1,200 900 600 300 100 Quantity 200 400 500 700 800 © South-Western Publishing
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Supply Curve for Notebook Computers
Price $2,100 1,800 1,500 1,200 900 600 300 100 Quantity 200 400 500 700 800 © South-Western Publishing
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Market Price for Notebook Computers
$2,100 1,800 1,500 1,200 900 600 300 100 Quantity 200 400 500 700 800 Demand Supply © South-Western Publishing
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TYPES OF ECONOMIC COMPETITION
GOALS for Lesson 3.3 Define pure competition and monopoly. Explain the characteristics of oligopolies and monopolistic competition. © South-Western Publishing
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All-Out Competition or No Competition At All
Pure competition Monopoly © South-Western Publishing
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Demand Curve for One Company in Pure Competition
Price Quantity © South-Western Publishing
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Demand Curve for a Monopoly
Price Quantity © South-Western Publishing
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Between the Extremes Oligopolies Monopolistic competition
Understanding the competition © South-Western Publishing
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Demand Curve for One Company in an Oligopoly
Price Quantity © South-Western Publishing
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Demand Curve for the Industry in an Oligopoly
Price Quantity © South-Western Publishing
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Demand Curve for Monopolistic Competition with Few Product Differences
Price Quantity © South-Western Publishing
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Demand Curve for Monopolistic Competition with Greater Product Differences
Price Quantity © South-Western Publishing
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ENHANCING ECONOMIC UTILITY
GOALS for Lesson 3.4 Define various types of economic utility. Explain how marketers use utility to increase customer satisfaction. © South-Western Publishing
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Utility Means Satisfaction
Economic utility Form utility Time utility Place utility Possession utility © South-Western Publishing
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