Show Menu

Economics and Business Cheat Sheet (DRAFT) by

Year 8 Marketing Madness

This is a draft cheat sheet. It is a work in progress and is not finished yet.

Types of markets

the sale of goods and services from businesses to an end user (called a customer).
the availa­bility of employment and labour, in terms of supply and demand.
any market­place where trading of securities including equities, bonds, currencies and deriva­tives occurs.
business or trade in land and houses.

Government influence on markets

Protecting property rights
protects your land, posses­sions and intell­ectual property.
Mainta­ining compet­ition
prohibits monopo­lies, prevents companies from hindering compet­ition.
Protecting consumers
provides info on produc­ts/­ensure they're safe.
Protects health and wellbeing of workers
protects health­/we­ll-­being of labourers.
Addressing extern­alities
government will promote positive extern­alities and limit negative ones.
Providing public goods
government products some goods and services to use at no charge.
Providing economic stability
government ensures job security and price predic­tab­ility
redist­rib­uting income
collect taxes and share with others for better income equality; unempl­oyment welfare ect.
Extern­ality: something outside of anyone's control.

Business sucess

A business owner should aim to produce a high-q­uality product. This means that the product will be reliable, safe and easy to use, durable, well designed and delivered to customers on time.
-introduce premium features
-ensure durability and reliab­ility
-achieve better perfor­mance than compet­itors
Exposing the product is essential for retail business. A business generally needs to locate as close as possible to it's customers or suppliers. Avoid locating businesses close to compet­itors. The area reputation is also an important factor.
Careful financial management is vital- cash flow must be mainta­ined. The owner must ensure that the business is profiting.

Consumer rights

‘Consumer rights’ are the rights you have when you buy something – either a product or a service.
The consumer guarantee states that the products you buy must be:
-be safe
-be of reasonable quality
-do all the things a reasonable person would expect them to
-match descri­ptions made by the salesp­erson, on the packaging and labels, and in promotions or advert­ising
-not have any hidden costs associated with their use or purchase
-meet any extra promises made about perfor­mance, condition and quality, such as lifetime guarantees and money-back offers
-have spare parts and repair facilities available for a reasonable time after purchase
Services that are provided by people must:
-be provided with acceptable care and skill, taking all necessary steps to avoid loss or damage
-achieve the results that the consumer and the business had agreed to
-be delivered within a reasonable time if there is no agreed end date
*see Australian Consumer Law

Key Terms

tangible items that satisfy people's wants (items you can see, touch and purchase)
the subject that deals with the produc­tion, distri­bution and consum­ption of goods and services
the total amount of a specific good or service that is available to consumers
consumer's desire and willin­gness to pay a price for a specific good or service
desires for goods and services that are not essential to live
supply of goods and services exceeds demand
demand for a product or service exceeds its supply in a market
individual or group that exchanges any type of good or service in return for payment
person­/group who agrees to buy goods or services
Price equili­brium
supply of goods is equal to demand

Supply and Demand

The Law of Demand
The law of demand states that, if all other factors remain equal, the higher the price of a good, the less people will demand that good.
The Law of Supply
The law of supply states that the higher the price, the higher the quantity supplied.
When supply and demand are equal (i.e. when the supply function and demand function intersect) the economy is said to be at equili­brium.
Disequ­ili­brium occurs whenever the price or quantity is not equal to P or Q
Excess Supply
If the price is set too high, excess supply will be created within the economy and there will be allocative ineffi­ciency.
Excess Demand
Excess demand is created when price is set below the equili­brium price. Because the price is so low, too many consumers want the good while producers are not making enough of it.