PROFIT SIGNALLING MECHANISM

Beschreibung

A-level ECONOMICS AND BUSINESS STUDIES Mindmap am PROFIT SIGNALLING MECHANISM, erstellt von julierubio0216 am 02/04/2014.
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Zusammenfassung der Ressource

PROFIT SIGNALLING MECHANISM
  1. HIGN PROFITS ARE MADE IN A MARKET
    1. WHICH MEANS DEMAND FOR P AND S ARE NOT SATISFIED
      1. RESOURCES CAN BE ALLOCATED INTO THE PROFITABLE MARKET
        1. COMPETITION WILL INCREASE IN THIS MARKET
          1. SUPPLY INCREASES
            1. PRICE DECREASES
      2. HIGH PRICE CAN BE CHARGED
      3. LOW COMPETITION
        1. HIGH PROFTS
          1. LOWER CONSUMER CHOICE
            1. CONSUMERS UNSATISFIED(DEMAND RISES)
              1. RESOURCES OF A BUSINESS CAN BE REALLOCATED IN THIS MARKET
                1. HIGH PRICE CAN BE CHARGED
          2. MONOPOLY POWER
            1. SUPERNORMAL PROFITS
              1. HIGH BARRIERS TO ENTRY
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