Marketing

Week One Summary Report

This week we have learned that the nature of U.S. business is private enterprise and it is considered a mixed market economy. Its basic goals are stability, full employment and growth. There are various global economies such as market, mixed market and planned economies. A market economy is where the buyers and sellers do business based on the freedom of choice. A planned economy is regulated and controlled by the government who has complete control of all resources and production. A mixed market economy incorporates elements of both planned and market environments. Supply and demand play an integral part in a market economy. The law of supply and demand states that the lower the cost of a good or service, the more consumers will purchase. The higher the cost of the good or service the less consumers will purchase, however the supplier will produce more. There are factors such as laborers, capital, entrepreneurs, physical resources and information resources that can effect demand and supply. Depending on the stability of these resources the economy can experience either surplus or deficit.

Private enterprise is comprised of four key factors; private property rights, freedom of choice, profits and competition. Competition can be separated into 4 categories; perfect competition, monopolistic competition, oligopoly and monopoly. Perfect competition as I have outlined in our threaded discussion is comprised of many buyers and sellers all offering goods or services. Monopolistic competition does not have as many sellers involved and is made up of the sellers getting into a marketing war for essentially the same product. Oligopoly is made up of few suppliers for a specific product such as airline manufacturers. A monopoly is a very rare form of competition in which there is only one seller for a specific product thus giving them the rights to control the market price.

In order to evaluate the success of an economic system we look at the GDP, GNP, productivity, balance of trade and the national debt. Our federal government tries to manage the U.S. economy through fiscal and monetary policies. The fiscal polices involve tax collection and how it spends its revenues. Their monetary policies focus more so on our Nation's money supply.

Within a corporation there are organizational boundaries that separate the corporation from its environment. There can be multiple organizational boundaries. These would be economic conditions, technology, political issues and many other challenges or opportunities. The economic environment strongly impacts business. There will always be periods of short-term ups and downs and that is considered the business cycle.