Unit 3 Economic Marketing

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Term Definition
Economy – The system of production and distribution and consumption. The overallmeasure of a currency system.
Free market – Any market in which trade is unregulated; an economic system freefrom government intervention. Allows supply and demand to regulate prices, wages,etc, rather than government.
Profit – The excess of total revenues over total costs in a given time period.
Price Competition – The rivalry among firms seeking to attract customers on thebasis of price, rather than by the use of other marketing factors.
Factors of Production – The productive resources of an economy, usually classifiedas land, labor, and capital. Entrepreneurship is frequently included as a fourth factorof production
Utility – The usefulness received by consumers from buying, owning, or consuminga product.
Place Utility – The increased usefulness created by marketing through making aproduct available at the place consumers want.
Possession Utility – The increased usefulness created by marketing throughmaking it possible for a consumer to own, use, and consume a product. It is alsocalled ownership utility.
Time Utility – The increased satisfaction created by marketing through makingproducts available at the time consumers want them
Market Economy – An economic system in which decisions concerning production and consumption aremade by individuals and organizations without intervention by a central planning authority.
Mixed Economy – A system in which both the state and private sector direct the waygoods and services are bought and sold.
Communism – A political philosophy or ideology advocating holding the productionof resources collectively.
Socialism – Any of various economic and political philosophies that support socialequality, collective decision-making, distribution of income based on contributionand public ownership of productive capital and natural resources, as advocated bysocialists.
Capitalism – a socio-economic system based on the abstraction of resources into theform of privately-owned money, wealth, and goods, with economic decisions madelargely through the operation of a market unregulated by the state
Productivity – A measure of the economic output per unit of input of someresource, e.g., the economic output per hour of human labor.
Gross National Product (GNP) – The money value of a nation's entire output offinal commodities and services in a given period.
Consumer Price Index (CPI) – A statistical measure maintained by the U.S.government that shows the trend of prices of goods and services (a market basket)purchased by consumers
Producer Price Index (PPI) – A monthly price index of about 2,800 commoditiesprepared by the U.S. Bureau of Labor Statistics, formerly known as the wholesaleprice index.
Inflation – An economic condition characterized by a continuous upward movementof the general price level.
Standard of Living – Relative measure of the general well being of a person or group.
Unemployment Rate – The percent of the total labor force without a job.
Supply – A schedule of the amounts of a good that would be offered for sale at allpossible prices at any one instance of time.
Demand – A schedule of the amounts that buyers would be willing to purchase at acorresponding schedule of prices, in a given market at a given time.
Elastic- A situation in which a cut in price increases the quantity taken in the market enough that total revenue is increased.
Inelastic – A situation in which a cut in price yields such a small increase in quantitytaken by the market that total revenue decreases.
Equilibrium – A situation in which the quantity and price offered by sellers equalsthe quantity and price taken by buyers.

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