Edexcel Economics 6. Business Behaviour

In this quiz the answers change every time you play! Guess the terms that fit these definitions
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Last updated: January 3, 2020
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First submittedSeptember 11, 2019
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A merger between firms or acquisition of one firm by another within the same industry and stage of production
Horizontal Integration
Those firms concerned with the extraction of raw materials
Primary Production
That which happens to average fixed costs (AFC) as output increases due to the same cost being dividing between a higher number of units
That which all costs are when output is zero
Fixed Costs
That which price elasticity of demand is when marginal revenue equals zero
Unit Elastic
That which firms might do so as to ensure their products are being sold, and sold well, while also stifling its rival companies' ability to compete
Forward Vertical Integration
Where shareholders are responsible for company debt up to the nominal value of their shares
Limited Liability
Short-run fixed costs which have already been paid for and cannot be recovered if the firms closes down
Sunk Costs
Internal economies of scale resulting from the trade discounts of buying in bulk
Purchasing Economies
Economies of scale that arise from the expansion of an industry in which firms are operating
External Economies of Scale
The cost of producing an additional unit of output, calculated as change in total costs ÷ change in output (ΔTC ÷ ΔQ) or (total cost from producing x+1 units) - (total from selling x units)
Marginal Costs (MC)
The conditions under which average revenue and marginal revenue fall with a rise in output
Imperfect Competition
That which often arises where firms within a particular industry are concentrated within one geographic area such as horse racing in Newmarket, Suffolk
External Economies of Scale
The level of output at which the long-run average cost curve reaches its lowest point, with no further advantage to economies of scale being possible
Minimum Efficient Scale
That which - if not sub-contractors - many small firms often act as to larger firms
Where the parent company retains some of the shares in a demerged business
Partial Demerger
Those that higher profits might benefit by increasing dividends and capital gains
Total revenue (TR) - Total Cost (TC)
Profit (π)
Internal economies of scale resulting from cheaper rates from advertising agencies, such as how a full page advert does not cost double a half page advert
Marketing Economies
The relationship between price and total revenue when demand is relatively price inelastic
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