Technological changes

Question 1

what is meant by invention?

Answer 1

refers to the creation of entirely new products and process that did not exist before
for e.g. printing press

Question 2

what is meant by innovation?

Answer 2

refers to the development of existing products, designs or ideas to improve them or introduce new features

Question 3

what are the advantages of technological change on production?

Answer 3

New methods - Tech has changed the way businesses process or manufacture products.This increases the speed of production

productivity - firms experience increased productivity as tech has the capacity to increase output per unit.This increases marginal revenue and as a result , maximises profit

Efficiency -Technologies have created efficiency gains for businesses
Automated processes reduce waste and allocate resources in most optimal way

Costs- The use of technology has lowered the cost of production as firms benefit from economies of scale more easily

Question 4

the impact of technological changes on existing markets

Answer 4

-businesses gain a competitive edge by using technology to create new products and update features to adapt to evolving consumer needs

• tech enables the design and development of prototypes and final products

Question 5

the impact of technological changes on new markets

Answer 5

The emergence of smartphones and social media platforms allows businesses to reach new markets through mobile apps and digital marketing

Question 6

technology can reduce barriers to entry

Answer 6

small businesses may be able to enter markets that are normally dominated by larger firms

Question 7

technology can reduce information asymmetry

Answer 7

Web technologies can harness, analyse, interpret and present large amounts of information quickly
Information on pricing and products is much more easily available

Question 8

what is the impact of technological change on market structure ?

Answer 8

changes to barriers to entry
information asymmetry
increased competition
Market power

Question 9

technology can increase competition

Answer 9

As more firms can access e-commerce platforms, digital marketing, and online marketplaces, which increases access to larger markets
E.g Airbnb’s online marketplace connects local hosts with customers from around the world

Question 10

technology can increase market power

Answer 10

This can result in the formation of more oligopolies or monopolies
E.g Technology giants Google and Amazon have gained significant dominance due to factors such as brand loyalty and economies of scale, making it difficult for smaller competitors to enter the market