Production methods
This production method involves the output of unique or one-off orders.
Job production
Define scarcity
Scarcity = demand higher than availability
The level of wealth, comfort, material goods, and necessities available to a certain socioeconomic class or geographic area.
Living standards
Costco's hotdog and free refill deal is an example of what pricing method?
Loss leader
What are the 4 Ps of marketing?
Price, Product, Place, Promotion
Involves producing a set of identical products, with work on each set being fully completed before production switches to another set, which may have slightly different specifications.
Batch production
These represent money being added to the economy
Injections
Monetary value of all finished goods and services made within a country during a specific period.
GDP
If I run a bakery and calculate a donut on average takes about 50c to produce, but I charge another $1 for my time and to cover overhead, what pricing method am I using?
Cost plus
1995
This is a production method whereby different operations are continuously and progressively carried out in sequence, with a very large output of standardized products.
Mass production
Name the four factors of production
Land
Labour
Capital
Entrepreneurship
What are the main causes of inflation?
Inflation is generally caused by production costs increasing, or demand for products increasing leading to people being willing to pay more for goods.
This pricing method that involves charging a low price, sometimes even below the cost, so as to damage the sales of rivals.
Predatory pricing
The apple of love
Name two advantages of batch production relative to job production
•Lower cost than job production
•Greater choice than job production
•Reduced risk if product doesn’t succeed, allows experimentation
Which organisation is responsible for setting the cash rate target?
The Reserve Bank of Australia
Measure of the average change over time in the prices paid by households for a fixed basket of goods and services.
CPI consumer price index
State two disadvantages of cost-plus pricing
Disadvantages of cost-plus pricing
•It ignores prices being charged by competitors, including those that charge a much lower price.
•It does not directly consider the needs of customers when the price is set.
•Rather than focusing on the possible level of demand for a firm’s products, it concentrates on calculating the price instead.
Vodka
Name 3 advantages of job production
Flexible (can be made unique to customer preference)
High cost
High quality (high skilled workers)
What are the injections and leakages associated with the government sector?
Taxes and Government spending
Top 5 countries by GDP
#1 United States Of America (U.S.A)
#2 China
#3 Germany
#4 Japan
#5 India
What is one disadvantage of premium pricing?
Premium pricing can limit the potential number of customers.
There are higher costs involved in producing higher-quality goods or providing better quality services
80%