Edexcel Business A Level Revision

Porter's Five Force analysis - A tool to analyse five competitive forces that affect a market and the intensity of competition within a industry or market. Barriers to entry - The obstacles that a business has to face when it is considering competing in an exisiting market It considers the threat of new entrants to a market the bargaining power of suppliers the bargaining power of customers the threat of substitute products the degree of competitive rivalry amongst exisiting competitors. It attempts to provide a simple way to look at all the relevant issues related to the changing competitive environment in which a business operates. Five Forces can be used by a business currently in a market to assess the security of its market position. Or it can be used by a business thinking of entering a market. THREAT OF NEW ENTRANTS Refers to the potential effect of a new business entering the market, presuming that it will gain market share and rivalry will increase. T...

Inflation - A sustained increase in the general level of prices within an economy, there is a fall in the value of money. It is measured by recording price changes for a wide range of goods and services likely to be bought by average families. Consumer price index - A measure that examines the weighted average of prices of a basket of consumer good/ services. Disinflation - This is when a lower inflation rate causes prices to rise more slowly Deflation - A decline in the general price level in an economy, characterised by an inflation rate that is lower than 0% Hyperinflation - A period of very high inflation rates, usually leading to a loss of confidence in an economy's currency Inflation rate - The annual rate of change of the average price of goods and services   Inflation can be a serious problem. it creates uncertainty and instability because it is hard to know whether it will accelerate or slow down.  It is measured by the annual percentage change in consume...