15 Questions
What is the main driver of innovation and new inventions in the marketplace?
Competition
What is the result of less competition in the market?
Companies have pricing power
What is an example of entrepreneurship?
Someone starting their own business
What is the relationship between innovation and invention?
Innovation is an improvement on something, while invention is the creation of something new
What is the consequence of more competition in the market?
Consumers have more purchasing power
What is the law of demand?
If prices decrease, consumers buy more so demand increases
What is the primary factor that affects supply?
The cost of producing or providing a good or service
What is the definition of entrepreneurship?
The act of taking calculated risks to start a business
What is the main difference between branch banking and unit banking?
The level of independence of each bank
Which of the following is an example of a human factor of production?
Factory workers
What is the definition of credit?
The privilege of using someone else's money for a period of time
What is a factor that can affect demand?
Change in consumer income
What is the law of supply?
As prices increase, supply increases
Which of the following is an entrepreneurial characteristic?
Risk taking
What is the definition of demand?
The quantity of a good or service that consumers are willing and able to buy
Study Notes
Economic Concepts
- Obsolescence occurs when new inventions and innovation make older products outdated.
Competition and Entrepreneurship
- Competition involves rivalry between parties striving for a common goal, leading to innovation and new inventions.
- With more competition, consumers gain; with less competition, companies have pricing power.
- Entrepreneurs start their own businesses, often due to competition, to offer better goods or services.
Invention and Innovation
- An invention is the creation of something new.
- An innovation is an improvement on something.
Demand and Supply Concepts
Demand
- Demand is the quantity of a good or service consumers are willing and able to buy at a particular price.
- Law of Demand: if prices decrease, consumers buy more, increasing demand; if prices increase, consumers buy less, decreasing demand.
- Factors affecting demand include:
- Customer awareness
- Price
- Accessibility
- Changes in consumer income, tastes, and expectations
- Population changes
Supply
- Supply is the quantity of a good or service businesses are willing and able to provide at a range of prices.
- Law of Supply: as prices increase, supply increases; as prices decrease, supply decreases.
- Factors affecting supply include:
- Production costs
- Price consumers are willing to pay
- Number of producers
- Changes in technology, expectations, and production costs
Four Factors of Production
- Natural resources: materials from the earth, water, and air.
- Human resources (labour): people creating goods and services.
- Capital resources: durable resources created by people, such as factories and equipment.
- Entrepreneurship: risk-taking, innovative business ventures.
Entrepreneurial Characteristics
- Risk taker: minimizing and managing risk to achieve success.
- Perceptive: seeing business opportunities others may not.
- Curious: understanding how things work.
- Imaginative: finding innovative solutions.
- Persistent: overcoming failures to achieve success.
- Hardworking: dedicating extra effort.
- Self-confident: believing in oneself despite doubts from others.
Banking Comparison
- Branch Banking: multiple branches connected to a central head office, popular in Canada.
- Unit Banking: independent banks operating without a headquarters, popular in the United States.
Credit and Savings
- Credit: using someone else's money for a period of time.
- Savings: setting aside money for future use.
This quiz covers the concepts of obsolescence, how competition leads to innovation, and the impact of competition on consumer purchasing power. Learn how companies like Apple and Samsung compete with each other.
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