s_apprentice
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I am currently on the unit about business markets. I can't seem to get my head around what to write for all 4 outcomes as I don't really understand the types of business market. Are the markets Free, Command and Mixed or do i talk about Public, private and voluntary?

The outcomes are:

1.1 Explain the characteristics of different business markets
1.2 Explain the nature of interactions between businesses within a market
1.3 Explain how an organisation’s goals may be shaped by the market in which it operates
1.4 Describe the legal obligations of a business

Any help would be greatly appreciated.
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SamGwynn
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Hi, I'm only on the Level 2 course right now so I'm afraid I can't offer too much help, but personally I'd consider Private, Public, and Voluntary examples of organisational sectors, not markets. So I would go with free, command, and mixed. Hope this is helpful in some way.
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abs96
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(Original post by s_apprentice)
I am currently on the unit about business markets. I can't seem to get my head around what to write for all 4 outcomes as I don't really understand the types of business market. Are the markets Free, Command and Mixed or do i talk about Public, private and voluntary?

The outcomes are:

1.1 Explain the characteristics of different business markets
1.2 Explain the nature of interactions between businesses within a market
1.3 Explain how an organisation’s goals may be shaped by the market in which it operates
1.4 Describe the legal obligations of a business

Any help would be greatly appreciated.
Hi - the below should help


AC1.1: Explain the characteristics of different business markets

Different business markets: perfect competition, imperfect competition
Perfect competition (no participants are large enough to have the market power to set the price of an identical product): large number of buyers and sellers, no barriers to entry or exit, perfect information, zero transaction costs, rational buyers, no externalities
Imperfect competition (a market structure showing some but not all features of competitive markets): incorporates monopolies (when a specific organisation is the only supplier of a particular commodity); monopolistic competition (many businesses sell products that are differentiated from one another, product differentiation); oligopoly (a market that is dominated by a small number of sellers); monopsony (a market in which only one buyer interfaces with many sellers, the buyer dictates terms to its suppliers)
AC1.2: Explain the nature of interactions between businesses within a market

In a perfect competition market

Interactions: many consumers buy a standardised product from many small businesses, no one seller sets the price, sellers and consumers accept the going price

Interactions in an imperfect competition market

Monopolies: all consumers will purchase a specific product from one business, the business: will set the price for that product
Monopolistic competition: consumers will purchase differentiated products that are similar but not identical from different businesses, businesses will compete to sell their product, demand for the product will affect the price
Oligopoly: consumers buy from a small number of large businesses, high interdependence between the businesses, businesses must take into consideration the reaction of the market to their actions
Monopsony: consumer has the power to dictate price to the business selling, one large consumer interacting with many smaller businesses

AC1.3: Explain how an organisation’s goals may be shaped by the market in which it operates

Organisations operating under a market of perfect competition

Primary organisational goals: profit maximisation, profitability, sales (value, volume), service level, customer satisfaction
Additional organisational goals: growth, achieving a state of imperfect competition (increasing market share, influencing consumer choice, influencing product price, expanding product range)

Organisations operating under a market of imperfect competition

Primary organisational goals: profit maximisation, profitability, sales (value, volume), growth, internationalisation, market share, market power, satisfying stakeholders, return on capital employed (ROCE), service level, customer satisfaction, corporate responsibility; ethical issues, welfare
Additional organisational goals: achieving a state of monopoly, i.e. when a specific organisation is the only supplier of a particular commodity, to join a state of oligopoly, i.e. a market that is dominated by a small number of sellers
Organisations operating under both perfect and imperfect competition markets
Market factors affecting an organisation’s goals: demand, supply, costs, revenues, price determination, profit, output determination, elasticity, inelasticity, equilibrium
AC1.4: Describe the legal obligations of a business

Legal obligations of a business: legal structure (sole trader, limited company, business partnership, social enterprise) and compliance with associated statutory requirements; responsibilities for insurance, liability, national insurance; intellectual property; employment law (covering pay, tax, national minimum wage, holidays, time off, sickness, maternity/paternity leave, pensions, rights at work, redundancies, dismissals, disciplinaries, contracts, working hours); consumer protection (covering credit and store cards, faulty goods including digital content, counterfeit goods, poor service, problems with contracts, rogue traders); requirement to report financial performance to Companies House
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