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Verity Russell
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Decks in this class (150)
Th3.1: Why Firms Grow Whilst Others Remain Small
What three reasons do firms grow for,
By growing a firm will be able to...,
A larger firm will hold a greater...
7
cards
Th3.1: The Principal Agent Problem
What is there in many large firms,
Firms are owned by,
Who work for the company and cont...
11
cards
Th3.1: Public and Private Sector
In the uk the economy is split in...,
What does the private sector refe...,
What does the public sector refer to
4
cards
Th3.1: Profit and Not-for-profit Organisations
Almost all private sector organis...,
What do private sector organisati...
2
cards
Th3.1: Organic Growth
What are the two main types of gr...,
What is organic growth,
Almost all growth of firms is
10
cards
Th3.1: Forward and Backward Vertical Integration
What is the one disadvantage,
What is integration,
What is a merger or amalgamation
7
cards
Th3.1: Forward and Backward Vertical Integration Advantages
What are the four advantages of f...,
Increased potential for profit,
Less risks
5
cards
Th3.1: Horizontal Integration Advantages
What is horizontal integration,
What are the three advantages of ...,
Increase market share
5
cards
Th3.1: Horizontal Integration Disadvantages
What is horizontal integration,
What is the one disadvantage of h...
2
cards
Th3.1: Conglomerate Integration Advantages
What is conglomerate integration,
What are the three advantages of ...,
No room for growth in present market
5
cards
Th3.1: Conglomerate Integration Disadvantages
What is conglomerate integration,
What is the one disadvantage of c...
2
cards
Th3.1: Constraints of Business Growth
What are the four constraints of ...,
Size of the market,
Access to finance
8
cards
Th3.1: Demergers
What is a demerger
1
cards
Th3.1: Reasons for Demergers
What are three reasons for demergers,
Lack of synergies,
What does a lack of synergy mean
10
cards
Th3.1: Impacts of Demergers
Positive impact workers,
Negative impact workers,
Positive impact businesses
6
cards
Th3.2: Profit Maximisation
What do neoclassical economists a...,
What can firms do by short run pr...,
Where do firms produce in order t...
8
cards
Th3.2: Revenue Maximisation
What did william baumol suggest,
Even when their salary is not dir...,
Why would a fall in revenue be ne...
8
cards
Th3.2: Sales Maximisation
What does robin marris suggest,
It is often easier for people to ...,
Why is size often linked to security
11
cards
Th3.2: Satisficing
What happens due to the principal...,
What will a directors goal be,
Therefore managers are likely to ...
5
cards
Th3.2: Other Aims
What are the two other aims i thi...,
Mum what did oliver williamson say,
Mum what will this be dependant on
5
cards
Th3.3: Types of Revenue
What is revenue,
Total revenue tr,
Average revenue ar
4
cards
Th3.3: Price Elasticity
Refer to pplook at graph 27 some ...,
Refer to pplook at graph 27 why d...,
What is the demand curve like don...
9
cards
Th3.3: Marginal Revenue
For goods with a downwards slopin...,
If marginal revenue is positive,
Refer to pplook at graph 28 where...
8
cards
Th3.3: Types of Cost
What is the economic cost of prod...,
In the short run,
In the long run
10
cards
Th3.3: Short-run Cost Curves
What is the short run,
What is the long run
2
cards
Th3.3: Diminishing Marginal Productivity
If a factor of production is fixe...,
Explain diminishing marginal prod...,
What does diminishing marginal pr...
4
cards
Th3.3: Curves
Refer to pplook at graph 29 what ...,
Refer to pplook at graph 29,
Refer to pplook at graph 29 what ...
16
cards
Th3.3: The Relationship Between Short-run and Long-run Cost Curves
Why are short run average cost sr...,
Why are long run average cost lra...,
Refer to pplook at graph 31 what ...
10
cards
Th3.3: Shift and Movement of the LRAC Curve
The long run average cost curve i...,
Points below the lrac are,
Producing above the lras is
5
cards
Th3.3: Economies and Diseconomies of Scale
What are economies of scale,
What is a firm able to experience...,
What are diseconomies of scale
8
cards
Th3.3: Internal Economies of Scale
What is an internal economy of scale,
What are the five different inter...
2
cards
Th3.3: ^^ Technical Economies
Why do technical economies arise,
Specialisation,
Balanced teams of machines
6
cards
Th3.3: ^^ Financial Economies
Why do large firms have greater s...,
As a result how does this benefit...,
This makes what more accessible
3
cards
Th3.3: ^^ Managerial Economies
Large companies can afford to,
Staff represent an
2
cards
Th3.3: ^^ Marketing and Purchasing Economies
Buying in bulk,
Specialistion,
Distribution
4
cards
Th3.3: External Economies of Scale
What is an external economy of scale,
What are the two types of externa...
2
cards
Th3.3: ^^ Labour
What do businesses established in...,
What is another advantage for lar...,
Firms will be able to hire staff who
3
cards
Th3.3: ^^ Support Services
What will businesses who provide ...
1
cards
Th3.3: Diseconomies of Scale
What are the five diseconomies of...
1
cards
Th3.3: ^^ Workers
Why may workers lose motivation a...,
What can they also lose with the ...
2
cards
Th3.3: ^^ Geography
What may a firm have to do
1
cards
Th3.3: ^^ Change
Who takes longer to respond to ch...
1
cards
Th3.3: ^^ Price of Materials
As businesses grow so does,
Although this can increase their ...,
When could this also occur
3
cards
Th3.3: ^^ Management
What are the two types of management,
Coordination and control,
Coordination and control what cou...
4
cards
Th3.3: Normal Profits, Supernormal Profits and Losses
What are profits,
What is normal profit,
In economics costs include
4
cards
Th3.3: Condition for Profit Maximisation
When is profit maximised,
Why will profit always be maximis...,
Sometimes mr and mc may cross as ...
3
cards
Th3.3: Short-run and Long-run Shut-down Points
When a business is making a loss ...,
If avr ar then,
However if avc ar
12
cards
Th3.4: Efficiency
What can efficiency be used for,
What are the four different types...
2
cards
Th3.4: ^^ Allocative Efficiency
When is allocative efficiency ach...,
When will allocative efficiency o...
2
cards
Th3.4: ^^ Productive Efficiency
When does a firm have productive ...,
The minimum resources are used to,
When can this only exist
4
cards
Th3.4: ^^ Dynamic Efficiency
When is dynamic efficiency achieved,
What is dynamic efficiency concer...,
What is the alternative
6
cards
Th3.4: ^^ X-inefficiency
When is a firm x inefficient,
What is this a specific type of a...,
Look at the example here
5
cards
Th3.4: Perfect Competition
What is perfect competition,
What is it like in reality,
Suggest an industry which fits th...
3
cards
Th3.4: Characteristics of Perfect Competition
For a good to be perfectly compet...,
What are the four characteristics...,
Many buyers and sellers
7
cards
Th3.4: Profit Maximising Equilibrium
Why will the firm produce at mr mc,
In the short run what different p...,
However firms in perfect competit...
8
cards
Th3.4: Efficiency
Perfect competition is,
What is perfect competition not,
What does the existence of perfec...
6
cards
Th3.4: Monopolistic Competition
What is monopolistic competition,
What does monopolistic competitio...,
What are some examples of firms i...
4
cards
Th3.4: Monopolistic Competition Characteristics
What are the three characteristic...,
Large numbers of buyers and sellers,
No barriers to entry or exit
4
cards
Th3.4: Profit Maximising Equilibrium 2
What kind of profits can firms ma...,
Why can firms only make normal pr...,
Refer to pplook at graph 35 firms...
8
cards
Th3.4: Efficiency 2
Why does ac ar,
Why does mr mc,
Because mr does not equal ar and ...
7
cards
Th3.4: Characteristics of Oligopoly
What is oligpoly,
What are the four characteristics...
2
cards
Th3.4: Kinked Demand Theory
Refer to pplook at graph 36 what ...,
Refer to pplook at graph 36 if a ...,
Refer to pplook at graph 36 above...
6
cards
Th3.4: N-firm Concentration Ratios
What can the concentration of sup...,
What does the 3 firm concentratio...,
What is one way the n firm concen...
4
cards
Th3.4: Collusive and Non-Collusive Behaviour
What is collusion,
What is it called when firms don ...,
If firms work together collude wh...
8
cards
Th3.4: Collusive Oligopoly
When firms engage in collusion th...,
What are the two main types of co...,
What is overt collusion
12
cards
Th3.4: Non-Collusive Oligopoly
What will the behaviour of a firm...,
What can game theory be used for
2
cards
Th3.4: Game Theory
What does game theory explore,
What is the aim of game theory,
What is the best way of demonstra...
12
cards
Th3.4: ^^ Prisoner's Dilemma
Refer to pplook at graph 38 what ...,
Refer to pplook at graph 38 what ...
2
cards
Th3.4: Types of Price Competition
What are the three main types of ...,
What are some other types of pric...
2
cards
Th3.4: Prices Wars
These occur in markets where,
What will a price war do,
What will a price war do
7
cards
Th3.4: Predatory Pricing
When does predatory pricing occur,
What will the established firm do,
What is the issue with this method
3
cards
Th3.4: Limit Pricing
What will firms do in order to pr...,
The greater the barriers to entry,
What area is limit pricing mainly...
4
cards
Th3.4: Other Pricing Strategies
What are the five other pricing s...,
Cost plus pricing,
Psychological pricing
8
cards
Th3.4: Types of Non-Price Competition
What does an oligopolistic market...,
What are the six types of non pri...,
Advertising
9
cards
Th3.4: Efficiency 3
Why will these firms be staticall...,
What efficiency are they likely t...,
What will they be able to do
3
cards
Th3.4: Characteristics of Monopoly
Where does pure monopoly exist,
Pure monopoly rarely exists but h...,
What does the model assume
3
cards
Th3.4: Profit Maximising Equilibrium 3
Refer to pplook at graph 39 the d...,
Refer to pplook at graph 39 where...,
Refer to pplook at graph 39 since...
3
cards
Th3.4: Third Degree Price Discrimination
What is third degree price discri...,
Give an example of this,
What three things must happen in ...
10
cards
Th3.4: Costs and Benefits
How do firms benefit,
Why do those in the elastic marke...,
What are some costs
6
cards
Th3.4: Natural Monopoly
What is said to happen in these i...,
What kind of industries are these,
There are no pure natural monopol...
8
cards
Th3.4: Costs and Benefits
Well done for getting this far
1
cards
Th3.4: ^^ Firms
What do monopolists have the pote...,
What does the existence of supern...,
What will firms with monopoly pow...
6
cards
Th3.4: ^^ Employees
Monopolists produce at lower outp...,
However what may the inefficiency...,
Why might more employees be employed
3
cards
Th3.4: ^^ Suppliers
For suppliers what will the impac...,
What will happen if the monopolis...
2
cards
Th3.4: ^^ Consumers
With a natural monopoly,
What will happen when firms enjoy...,
Why may monopolists do due to cro...
6
cards
Th3.4: ^^ Efficiency
What kind of efficiency is a mono...,
Why will a monopolist be dynamica...,
However if there is no competition
3
cards
Th3.4: Williamson Trade Off
J,
Refer to pplook at graph 41 what ...,
Refer to pplook at graph 41 where...
13
cards
Th3.4: Extra Monopoly Info
Why are there a few permanent mon...,
Why do some suggest a monopoly or...,
Why are the bad aspects of monopo...
4
cards
Th3.4: Characteristics and Conditions of Monopsony
What is monopsony,
In real life pure monopsonies rar...,
Why will they pay their suppliers...
9
cards
Th3.4: Costs and Benefits
Keep going well done
1
cards
Th3.4: ^^ Firms
How does the monopsony gain highe...,
What do they achieve
2
cards
Th3.4: ^^ Consumers
Why might customers gain from,
It could lead to a fall in supply...,
What might they act as
4
cards
Th3.4: ^^ Employees
What will the supplier do,
What will the monopsonist do,
How will making higher profits af...
3
cards
Th3.4: ^^ Suppliers
Why will suppliers lose out
1
cards
Th3.4: Contestability
What is this model concerned with,
What is a contestable market,
Even in a monopoly why might a fi...
4
cards
Th3.4: Characteristics of Contestable Markets
What is there within a contestabl...,
There is freedom of entry and exi...,
Firms will be able to and have th...
5
cards
Th3.4: Implications
What will firms do in a contestab...,
What is the only way to avoid this,
In a perfectly contestable market...
8
cards
Th3.4: Types of Barriers to Entry and Exit
Some barriers are natural barrier...,
However others are put in place b...,
Why must both costs for the entry...
11
cards
Th3.4: Sunk Costs and the Degree of Contestability
What is a sunk cost,
Why will all businesses face sunk...,
What is the degree of contestabil...
6
cards
Th3.4: Reasons for Increasing Contestability
The recession has meant that entr...,
What has the deregulation of mark...,
What has the european single mark...
10
cards
Th3.5: Demand for Labour
What does the demand curve for la...,
What is the demand for labour det...,
The higher the mrp
7
cards
Th3.5: Derived Demand
How is demand for labour derived ...,
Businesses only want workers for ...
2
cards
Th3.5: Factors Influencing Demand for Labour
What are the first three factors ...,
What are the final three factors ...,
Wage rates
10
cards
Th3.5: Factors Affecting PED of Labour
What are the four factors affecti...,
Directly correlated to the price ...,
Proportion of wages to the total ...
6
cards
Th3.5: Factors Influencing Supply of Labour
What does the supply of labour cu...,
What are the first three factors ...,
What are the final three factors ...
9
cards
Th3.5: ^^ Wages
The supply of labour curve for an...,
What are the two ways firms can i...,
Therefore although an increase in...
3
cards
Th3.5: Market Failure
What should an increase in wages do,
What should a fall in labour do,
However
3
cards
Th3.5: Immobility
What can labour suffer from,
Occupational mobility,
Geographical immobility
5
cards
Th3.5: Elasticity of Supply
What is elasticity of supply,
What will the elasticity of suppl...,
What else can the elasticity of s...
7
cards
Th3.5: Wage Determination in Competitive and Non-Competitive Markets
What things do wage rates differ ...,
For the highest paid workers,
What does the immobility of labou...
4
cards
Th3.5: Wage Determination:
What are the four different types...,
Well done keep going
2
cards
Th3.5: ^^ Perfect Competition
In a perfectly competitive labour...,
Therefore wages are determined,
What would workers do if they wer...
6
cards
Th3.5: ^^ Monopsony in the Labour Market
In a monopsony market there is on...,
In this situation businesses know...,
Therefore the mc curve is above t...
7
cards
Th3.5: ^^ Monopoly in the Labour Market
What does the existence of trade ...,
What is a trade union,
What is the first way they could ...
9
cards
Th3.5: ^^ Bilateral Monopoly
What is a bilateral monopoly,
Refer to pplook at graph 46 the f...,
Refer to pplook at graph 46 what ...
9
cards
Th3.5: Labour Market Issues
What are the first four labour ma...,
What are the final three labour m...,
Skills shortages
10
cards
Th3.5: Arguments for the National Minimum Wage
What are the first three argument...,
What are the final three argument...,
Reduce poverty
8
cards
Th3.5: Arguments against the National Minimum Wage
What are the four arguments again...,
Loss of jobs in the industry,
Raise costs for the companies
5
cards
Th3.5: Impact of Minimum Wage
What will the impact of any minim...,
What is the level of job losses d...
2
cards
Th3.5: Minimum Wage - Macroeconomic Effects
What are the four macroeconomic e...,
Reduce inequality,
Rise in ad
5
cards
Th3.5: Maximum Wages
How common are maximum wages,
Who do some people suggest there ...,
How can the government keep publi...
9
cards
Th3.5: Public Sector Wage Setting
What can the government do since ...,
What did public sector workers ex...,
What did this pay freeze do
5
cards
Th3.5: Tackling Immobility
What are the five ways the govern...,
What are the four ways the govern...,
Supply of houses
13
cards
Th3.6: Government Intervention
What does the competition and mar...,
What is the cma able to do in ord...
2
cards
Th3.6: Controlling Mergers
In the uk how are mergers assessed,
What will the cma consider,
When is a merger investigated
5
cards
Th3.6: Controlling Monopolies
Holding a dominant position in an...,
What kind of efficiency are monop...,
What does most of this regulation...
4
cards
Th3.6: ^^ Price Regulation
What can regulation do,
What does x represent in the rpi ...,
Arguably a better system is
9
cards
Th3.6: ^^ Profit Regulation
In the usa where is rate of retur...,
How is this a good thing,
How is this a bad thing
5
cards
Th3.6: ^^ Quality Standards
Monopolists will only produce hig...,
The government can introduce qual...,
What is the problem with quality ...
4
cards
Th3.6: ^^ Performance Targets
What can regulators introduce,
It is also possible to split up a...,
What could they do to help firms ...
6
cards
Th3.6: Other Types of Regulation for Monopolists
What are four other types of regu...
1
cards
Th3.6: Promoting Competition and Contestability
What are the three ways of doing ...
1
cards
Th3.6: ^^ Promotion of Small Business
What can the government do throug...,
How is the promotion of small bus...,
What does the red tape challenge ...
3
cards
Th3.6: ^^ Deregulation
What is deregulation,
What will deregulation do,
The government can also do what t...
4
cards
Th3.6: ^^ Competitive Tendering
Why does the government have to p...,
Goods such as the sheets in nhs h...,
A similar thing can be done with ...
8
cards
Th3.6: Protecting Suppliers and Employees
What are ways of protecting suppl...
1
cards
Th3.6: ^^ Restrictions on Monopsony Power
How are monopsonists able to expl...,
How can the government prevent this,
What can be put in place for thos...
3
cards
Th3.6: ^^ Workers' Rights
How does the government protect e...,
What can the government also enco...,
What is the problem
3
cards
Th3.6: Privatisation and Nationalisation
What is privatisation,
What is the aim of privatisation,
What is nationalisation
3
cards
Th3.6: Advantages of Privatisation
What are the first five advantage...,
Greater competition,
Accountable
6
cards
Th3.6: Disadvantages of Privatisation
What are the four disadvantages o...,
Abuse their monopoly position,
Important industries
5
cards
Th3.6: Advantages of Nationalisation
What are the five advantages of n...,
Investment is needed for the long...,
Natural monopoly
6
cards
Th3.6: Disadvantages of Nationalisation
What are the three disadvantages ...,
Principal agent problem and moral...,
X inefficiency
4
cards
Th3.6: Natural Monopolies
It is argued that if the industry...,
Refer to pplook at graph 47 where...,
Refer to pplook at graph 47 howev...
4
cards
Th3.6: Impacts of Government Intervention
What are governments able to do,
What do governments try to ensure,
What might high regulation do
12
cards
Th3.6: Limits
What are the two types of limit
1
cards
Th3.6: Regulatory Capture
When does regulatory capture occur,
The fact that the regulator will ...,
What can large corporations inves...
5
cards
Th3.6: Asymmetric Information
What is asymmetric information in...,
It is in the industry s best inte...,
As a result when may government f...
3
cards
Fernie Definitions Test
Total cost,
Variable cost,
Fixed cost
14
cards
Fernie Definitions Test 2
Conglomerate merger,
Demerger,
Horizontal integration
15
cards
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