Revision lesson 1 - paper 1 Flashcards
What is the formula for market share
(Sales of x / Total market sales) x 100
What is the formula for % change
(New - old) / old x 100
How do you calculate market size
Total value of all sales of the product
What is the formula for PED
% change in QD / % change in price
What is the formula for YED
% change in QD / % change in income
What does it mean if PED is >1
Elastic: change in price causes larger change in demand
What does it mean if PED is <1
Inelastic: change in price causes smaller change in demand
What happens to revenue on a price elastic product
Increases with a price cut
What happens to revenue on a price inelastic product
Increases with a price increase
What is a product that has a YED between 0 and +1
Necessity
What is a product that has a YED of >+1
Luxury
What is a product that has a YED of <0
Inferior good
What are some factors that can influence PED of a product
Brand strength, habit, availability of substitutes, time
What is product orientation
Emphasis on product, e.g design, quality
What is market orientation
Emphasis on consumer needs e.g McDonalds
What is primary research with 2 examples
New info collected for the first time, e.g questionnaires and interviews
What is secondary research with 2 examples
Already existing research, e.g internet, government data
What are 2 pros of primary research
Up to date, specific to the business
What are 2 cons of primary research
Expensive, time consuming
What are 2 pros of secondary research
Cheaper, quicker to collect
What are 2 cons of secondary research
May be out of date, not relevant to the business
What is quantitative data
Data can be analysed using graphs and numbers
What is qualitative data
Collected via focus groups to give feelings and opinions
What is an advantage of quantitative research
Easier and quicker to analyse
