Economics

Maximum Prices (Price ceilings)

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Maximum Prices (Price ceilings) A maximum price (Ceiling) occurs when a government sets a legal limit on the price of a good or service. For example, the government may set a maximum price on bread of £1 or a maximum weekly rent that can be charged £150.      
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Maximum Prices (Price ceilings)
Stakeholder Mapping Theory

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Stakeholder Mapping  Understanding the role and importance of stakeholders What is Stakeholder Mapping? The stakeholder mapping theory sorts stakeholders out in terms of their relative power and interest. This theory highlights that not all stakeholders are the same. Stakeholders vary in terms of the power and influence they have on a business.  Stakeholder Mapping Diagram […]
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Stakeholder Mapping Theory
Retrenchment

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Definition of Retrenchment Retrenchment in business occurs when they cut down or reduce something to become more financially stable. When does a business use retrenchment? Retrenchment could occur during a recession It could occur when a company is going through financial difficulty The impact of an economic shock to the economy such as the coronavirus […]
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Retrenchment
Tradable Pollution Permits (ETS)

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What are tradable pollution permits? Tradable pollution permits is a system created to encourage firms to reduce their overall pollution levels. It is a cap and trade system allowing firms to sell any unused permits and buy extra permits from other firms or governments. ETS – Emissions Trading System In 2005 the European Commission set […]
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Tradable Pollution Permits (ETS)
Natural Monopoly

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Natural Monopoly What is a Natural Monopoly A Natural Monopoly occurs where the industry can only support one firm. Characteristics of Natural Monopolies High start-up costs High fixed costs High barriers to entry Unique product or service The industry can only support one firm Examples of Natural Monopoly An example of a Natural Monopoly would […]
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Natural Monopoly
Market Capitalisation

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Market Capitalisation This is the total market value of all of a company’s outstanding shares. Market capitalisation is calculated by multiplying a company’s outstanding shares by the current market price of one share. This figure is used to determine a company’s size.
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Market Capitalisation