3.3 Marketing Management Flashcards
(16 cards)
What does YED measure
the extent to which the quantity of a product demanded is affected by a change in income
what happens to inferior goods when income decreases
quantity demanded increases
negative income effect
what happens to inferior goods when income increases
quantity demanded decreases
negative income effect
what happens to luxury goods when income increases
quantity demanded increases
positive income effect
what law do normal goods follow
the law of demand
What is the law of demand
as price increases, quantity demand decreases and vice versa
what kind of YED do most products have
positive YED - as consumers income rises quantity demanded rises
What YED do normal necessities have
a YED of between 0 and +1
eg, if income increases by 10%, and the demand for a normal necessity increases by 4%, then the income elasticy is +0.4
What YED does luxury goods have
a YED of greater then +1 (demand rises more than proportionate to a change in income)
eg. an 8% increase in income might lead to a 10% rise in demand, the YED in this eg is +1.25
What YED do inferior goods have
a negative YED
What are the three main types of sampling
Random, Quota, and Stratified
What is random sampling, give a pro and con
everyone has an equal chance of being chosen
less chance of bias
may not represent whole market
What is quota sampling
selected based on specific characteristics, eg, age, income, location
required number of participants is then drawn from each segment
what is stratified sampling
researcher divides/ stratifies the largest group into sections, each representing a key characteristic
What is correlation
it looks at the relationship between two variables
what is positive correlation
