Chapter 2 no money involved its a barter transaction

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CHAPTER 2 No money involved it’s a barter transaction Money involved it’s a purchase transaction. Spot transactions happen now or in a more or less continuous manner. Future- delivery on a future date pay now Transactions involving the firm and some party in its environment are market transactions. Transfer Transaction- A transaction between two different parts of the same firm Transfer transactions are priced less than normal market price but above the cost of production. Transfer Pricing Problem UPPP Input transaction- which the firm is a buyer
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Output – firm is a seller Open system hypothesis says firms must engage in both Market is an arena in which transactions occur Price system is the Market Regulatory mechanisms- government stepping in to set rules on how things can be done The orderliness of markets is due to a combination of the price system and a set of non price regulatory mechanisms. Info everyone knows-Symmetric Asymmetric- one person knows has advantage til someone finds out then copies and everyone knows Competitor- anyone on the same side as you..if you’re a buyer buyers are your competitors Market share- % of total market sold by one producer Product differentiation- or product innovation changing your product to escape perfect competition. Product Development- is the process of making investments in market research with the hope of discovering new products.
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Market segments. Process Enhancement- reduce the cost of production, if successful can lower prices. New business model An idealized market characterized by many customers, many similar bu completely substitutable products and one producer of each of these products is called monopolistic competition. First to escape perfect competition- First mover. 5 sources of investment money 1. retained earnings. 2. Current revenue. 3. Sell an asset 4. Selling equity 5. Debt Chapter 3 Many firms simultaneously participate in multiple industries. An industry is a set of players that sell more or less the same thing. Player could refer to an entire firm or to a division of a firm.
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Entire firm aka Coke. Has divisions SIC system replaced in 1997 by NAICS systems however both are still used by the FEDs Demand side sustainability- refers to the possibility of customers switching between suppliers. From buyers prespective. What other firms exist where I can buy this? Supply Side- refers to the technological capabilites of producers. From sellers prespective. What firms have the ability to make what I do. Rivals are competitors who sell what you sell. There is a tradeoff between the benefits of focus and the avoidence of risk. More than one area firm is diversified. One focus is focused. Porter industry analysis. 5 forces that affect competitive situation 1.
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  • Spring '12
  • BobAtkin
  • Marketing, The Market

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