MGTA05H3 Chapter 5: Detailed Notes from the text
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MGTA05H3 Full Course Notes
Verified Note
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Document Summary
Chapter 5- when buyers and sellers interact- how markets work. Market- not a place, but the interaction of buyers and sellers, exchanging information about products and services for sale. The market is an abstract idea, its thousands of people exchanging information about prices, products and much more, than a physical place. It is a place where sellers and buyers interact with each other. Kensington market, your neighbour who wants to sell you fruit, imported from their country etc. In a market, prices are set by negotiating. Sellers hope to maximize their surplus, by maximizing revenue > maximizing profits. Buyers trying to minimize their expenditure, and maximizing their consumer. In a market economy, because of the huge number of private enterprises and heavy competition, sellers are able to go from vendor to vendor, until they find sth just right for them. Example: a used book sold by an upper year.
