A market is any place that brings together buyers and sellers with a view to agreeing a price for exchange.
This means that markets coulb be anything from a street market to a supermarket to e-bay, a pub, club, the London metal exchange, or drugs transaction on a street corner. Wheter legal or not, each of exemples has the characteristics of a buyer, a seller and a price.
needs are essential to our survival : foods, clothes, home,... Wants are thing we would like to buy <- necessary ressource = money
sources of monney = factors of production :
- Wages (labour) : reward for labour
- interest : investing capital in business
- rent : payment for land / property
- profit : extra money a business makes
different types of demand:
- effective demand : real ability / capacity to buy something
- actual demand : what people buy in reality
- composite demand : demand that is linked (=connected) for products with more than one use
- derived demand : a change in economics circumstances
- When prices go dowm = decrease : extension
- when prices go up = increase : contraction
If prices increase consumers change their minds and buy substitutes at a cheaper price.
complementary product = demand for one product closely related to price and demande for another product
ex : petrol and cars, land and housing
complementary goods = strong interreliationship between goods, can influence each other
demand = not a single concapt -> is variation
- contraction in demand = decrease
- extension in demand = increase