economie and marketing

8/14/2019 Economie and Marketing

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BLIDA UNIVERSITY

FACULTY OF ECONOMIC AND MANAGEMENT

ENGLISH SEARCH .

SECTION 1 : ECONOMIC

1/-DEFINITION OF ECONOMIC

2/-ECONOMIC PROBLEMS

3/- HOW THE ECONOMY GROWS

4/- KINDS OF ECONOMIC SYSTEMS

5/-THE DEVELOPMENT OF ECONOMICSPrep a red by . ***************** .

Option : Marketing

Professor of english : Mr TOUAHAR

2004/2005


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SECTION 2 : MARKETING

1/- MARKETING

2/- MARKET RESEARCH

3/- PRODUCT DEVELOPMENT

4/- DISTRIBUTION

5/- PRICING

6/- PROMOTION

7/- CANALISE PRODUCT

SECTION 1 : ECONOMIC

1/-DEFINITION OF ECONOMIC

Economics is the social science concerned with the analysis of

commercial activities and with how goods and services are produced.

The field of economics studies how the things people need and want

are made and brought to them. It also studies how people and

nations choose the things they buy from among the many things they

want.


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In all countries, the resources used to produce goods and services are

scarce. That is, no nation has enough farms, factories, or workers to

produce everything that everyone would like. Money is also scarce.

Few people have enough money to buy everything they want when

they want it. Therefore, people everywhere must choose the best

possible way to use their resources and money. Children may have to

choose whether to spend their allowance on a film or a hamburger.

Shopkeepers may have to choose whether to take a summer holiday

or to use their savings to buy more goods. A nation may have to

choose whether to use tax-payers' money to build more roads or more

submarines. In economic terms, the children, the shopkeepers, andthe nation all must economize in order to satisfy their most important

needs and wants. This means they must try to use the resources they

have to produce the things they most want.

Economists (specialists in economics) define economics as the study

of how goods and services get produced and how they are distributed.

By goods and services, economists mean everything that can be

bought and sold. By produced, they mean the processing and making

of goods and services. By distributed, they mean the way in which

goods and services are divided among people.

2/- ECONOMIC PROBLEMS

Every nation must organize the production and distribution of goods

and services wanted by its citizens. To do this, a nation's economic

system must solve four basic problems: (1) What shall be produced?

(2) How shall goods and services be produced? (3) Who shall get the

goods and services? and (4) How fast shall the economy grow?


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What shall be produced? No nation can produce enough goods and

services to satisfy all its people. But which goods and services are

most important? Should land be used to rear animals or grow

wheat? Should factories be used to produce tractors, or television

sets?

How shall goods and services be produced? Should each family grow

its own food and make its own clothing? Or should special industries

be developed to provide these products? Should many workers be

used in an industry? Or should more machines be used instead?

Who shall get the goods and services? Should everyone have anequal share of goods and services? Which goods and services should

go only to people who can afford to buy them? Which goods and

services should be distributed in some other way?

How fast shall the economy grow? An economy grows when it

produces more goods and services. A nation must decide what

proportion of its scarce resources should be used to build factories

and machines and provide more education, all of which will increase

future production. How much of a nation's resources should be used

to produce goods and services, such as food and clothing, for

immediate use? In addition, the nation must decide how to avoid

unemployment and other economic setbacks that waste resources.

3/- HOW THE ECONOMY GROWS

An economy must grow to provide people with an increasing

standard of living--that is, more and better goods and services.


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Making the economy grow. Four main elements make it possible for

nations to produce goods and services. These elements, called

productive resources, are: (1) natural resources, (2) capital, (3) a

labour force, and (4) technology. Economists define natural

resources as all land and raw materials, such as minerals, water, and

sunlight. Capital includes factories, tools, supplies, and equipment.

Labour force means all people who work or are seeking work, and

their education and skills. Technology refers to scientific and

business research and inventions.

In order to grow, a nation's economy must add to its productive

resources. For example, a nation must use some of its resources tobuild factories, heavy equipment, and other capital goods. A nation

also must develop additional natural resources, create new

technologies, and train scientists, workers, and business managers,

who will direct future production. The knowledge of these people is

known as human capital.

Measuring economic growth. The value of all goods and services

produced in any year makes up a nation's gross domestic product.

An economy's rate of growth is measured by the change in its gross

domestic product over a period, usually year on year. In the period

1970 to 1988, the gross domestic products of different countries grew

at widely different average rates, after adjustments were made for

inflation. The following rates were achieved: the United Kingdom

(UK) 2.2 per cent, the United States 2.9 per cent, Ireland 3.0 per cent,

Australia 3.3 per cent, Canada 4.4 per cent, Malaysia 6.5 per cent,

Singapore 8.0 per cent, and South Africa 9.2 per cent.

Another way of measuring a nation's economic growth is to study the

standard of living of its people. To judge standard of living,


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economists sometimes divide a nation's total gross domestic product

by its entire population. The resulting figure is called the per capita

GNP. The per capita GNP of a nation is the value of goods and

services each person would receive if all the goods and services

produced in the nation that year were divided evenly among all the

people.

4/- KINDS OF ECONOMIC SYSTEMS

Different economic systems have developed because nations have

never agreed on how to solve their basic economic problems. Three

important economic systems today are (1) capitalism, (2) mixed

economies, and (3) Communism. The economies of many countries

include elements from several different economic systems.

Capitalism is the economic system of many countries throughout the

world. It is called capitalism because an individual can own land and

such capital as factories, buildings, and railways. Capitalism is also

known as free enterprise because it allows people to carry out their

economic activities largely free from government control.

The Scottish economist Adam Smith first stated the principles of the

capitalist system in the 1700's. Smith believed that governments

should not interfere in most business affairs. He said the desire of

business people to earn a profit, when regulated by competition,

would work almost like an "invisible hand" to produce what

consumers want. Smith's philosophy is known as laissez faire

(noninterference).


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Adam Smith's emphasis on individual economic freedom still forms

the basis of capitalism. But the growth and complexity of modern

businesses, cities, and technologies have led people to give the

government more economic duties than Smith gave it.

Mixed economies involve more government control and planning

than do capitalist economies. In a mixed economy, the government

often owns and runs such important industries as transport,

electricity, gas, and water. Most other industries may be privately

owned.

Communism, in its traditional form, is based on governmentownership of nearly all productive resources and government control

of all important economic activity. Government planners make all

decisions about producing, pricing, and distributing goods. However,

in many countries where this system has been adopted, the economy

has not prospered. In the mid-1980's, China began to relax its

governmental control over business activity and prices. In the late

1980's and early 1990's, governments rejecting Communist principles

succeeded Communist governments in many Eastern European

countries and the Soviet Union.

5/-THE DEVELOPMENT OF ECONOMICS

Early beginnings. People have been interested in economic problems

since earliest times. One of the earliest socio-economic systems

(systems that involve both social and economic factors) was

manorialism. Under the manorial system, landlords rented out land

to tenants or employed people to do work on the land in return for

wages. This system still operates in some countries today.


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Manorialism started at the end of the Roman Empire and became

widespread in western Europe.

The first major theories about a nation's economy were not

developed until the 1500's, the beginning of the period of

mercantilism. The mercantilists believed that a government should

regulate economic activities to establish a favourable balance of

trade. They said nations could increase money supply by exporting

more products than they imported.

During the 1700's, a group of French writers known as physiocrats

attacked mercantilism. The physiocrats believed that governments

should interfere less in economic life. They were the first economiststo use the term laissez faire to mean noninterference by the

government. The physiocrats also began the first organized study of

how economies work.

The classical economists. Most economists today consider Adam

Smith to be the father of modern economics. Smith, a Scottish

professor of philosophy, built on some of the ideas of the physiocrats.

Smith's book The Wealth of Nations (1776) includes many ideas that

economists still accept as the basis for private enterprise. Smith

believed that free competition and free trade help an economy grow.

He said the government's main role in economic life should be to

assure effective competition. Smith and his followers became known

as classical economists.

Three British economists of the late 1700's and the 1800's wrote

particularly influential works. David Ricardo published strong

arguments for free trade among nations. Thomas Robert Malthus

challenged some of Smith's ideas but developed others further.

Malthus warned that if populations continued to grow, nations


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someday would not be able to produce enough to feed all the people.

John Stuart Mill proposed that profits be divided more equally

among employers and workers.

Karl Marx and Communism. Some writers disagreed with the idea

that competition would lead to economic progress. The most

influential was Karl Marx, a German philosopher of the 1800's. In

his book Das Kapital (Capital), Marx interpreted human history as a

struggle between the ruling class and the working class. He declared

that free enterprise would lead to increasingly severe depressions,

and eventually to a revolution by the workers. In the Communist

Manifesto, Marx and his friend Friedrich Engels called for aneconomy in which the government would own most of the property.

Marx's theories provided the basis for the development of

Communism.

New solutions for old problems. During the late 1800's and the early

1900's, economists began to use scientific methods to study economic

problems. In France, Leon Walras worked out a mathematical

statement to show how each part of an economy is related to all the

other parts. Wesley Clair Mitchell, an American, urged economists

to use statistics in testing their theories. Mitchell also studied booms

and depressions.

The Great Depression of the 1930's caused economists to seek a new

explanation of depressions. John Maynard Keynes, a British

economist, attacked the idea that free markets always lead to

prosperity and full employment. In The General Theory of

Employment, Interest and Money, Keynes suggested that

governments could help end depressions by increasing their own

spending.


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During the 1960's and 1970's, a group of economists called

monetarists rejected many of the theories of Keynes and his

followers. Instead, the monetarists urged that governments increase

the money supply at a constant rate to stabilize prices and promote

economic growth. Milton Friedman, an American economist, became

the leading spokesman for monetarism.

Research today generally centres on understanding the relationship

between various parts of the economy. Economists base their

findings on observation, on case studies, and on other methods of

research. Many economists emphasize the use of mathematics andstatistics in testing economic theories. Their method is known as

econometrics. Economic analysis has been applied to many problems

that seem unrelated to production, such as education, family life, and

government. Whenever resources available to achieve an objective

are limited, economic analysis may be useful.

SECTION 2 : MARKETING

1/- MARKETING

Marketing is the process by which sellers find buyers and by which

goods and services move from producers to consumers. There are

many marketing activities. For example, advertising and selling are

part of the marketing process. Other marketing activities include

financing by banks and deliveries to shops and homes. Marketing is


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so important to industry that about half the cost of goods and

services results from the marketing process.

Consumers in most countries can choose from a huge variety of

products and services. Therefore, a company must have an effective

marketing programme to make its products and services attractive to

customers. Every growing business engages in five major marketing

activities: (1) market research, (2) product development, (3)

distribution, (4) pricing, and (5) promotion.

2/- MARKET RESEARCH

Market research is the study of the probable users of a product or

service. Such potential customers are called a market. It also

examines competitive products and the way in which they are sold

and distributed. There are many sources of market information. For

example, government statistics about population and income indicate

the size of a market and its purchasing power.

3/- PRODUCT DEVELOPMENT

Product development includes determining the various goods to be

offered, as well as developing the products themselves.

Manufacturers continually meet the demands of the public by adding

new products, changing existing ones, and dropping others.

4/- DISTRIBUTION


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Distribution is the movement of goods and services from producer to

consumer. A manufacturer must establish a system that keeps

products moving steadily from the factory to the customer. Such a

system is called a marketing channel or a channel of distribution.

Many types of companies take part in distribution. They include

wholesalers, who sell large quantities of goods to retailers. The

retailers, in turn, sell small numbers of products to consumers.

Independent dealers and agents buy goods from manufacturers in

large quantities and sell them to retail dealers in small quantities.

Other firms provide such services as financing, transportation, and

storage.

5/- PRICING

Pricing. When setting the price of a product, most manufacturers

start with their unit production cost, the expense of making one unit

of the item. They add a percentage of this cost to provide a profit for

themselves. Each firm adds an amount that covers its expenses and

enables it to make a profit. The amount added at each stage is called

a markup. The final selling price of an item equals its production

cost plus the total of the markups. See PRICE; PROFIT.

Some people believe a large part of the money spent on marketing is

wasted. But most economists believe the marketing process actually

benefits consumers. For example, market research helps industry

offer what customers need and want. Marketing also provides

consumers with shopping information and makes products available

in convenient quantities at nearby locations.


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6/- PROMOTION

Promotion includes advertising, catalogues, coupons, direct-mail, in-

store displays, and door-to-door sales. Companies engage in a variety

of promotional activities to inform customers about products and

services and to persuade them to buy. See the articles on

ADVERTISING and SALESMANSHIP for more information about

this phase of marketing

7/- CANALISE PRODUCT

Market research is the process of gathering and analysinginformation to help business firms and other organizations make

marketing decisions. Business executives use market research to help

them identify markets (potential customers) for their products and

decide what marketing methods to use. Government officials use

such research to develop regulations regarding advertising, other

sales practices, and product safety.

Market research services are provided by several kinds of companies,

including advertising agencies, management consultants, and

specialized market research organizations. In addition, many large

business companies have their own market research department.

Market researchers estimate the demand for new products and

services, describe the characteristics of probable customers, and

measure potential sales. They determine how prices influence

demand, and they test the effectiveness of current and proposed

advertising. Market researchers also assess a company's sales

personnel and analyse the public "image" of a company and its

products.


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A market research study begins with a statement of the problem that

the client wants to solve. This statement leads to a detailed definition

of the information to be gathered. There are two types of market

research information, secondary data and primary data.

Secondary data are statistics and other information that are already

available from such sources as government agencies and universities.

To save time and money, market researchers use secondary sources

as much as they can. Primary data are data that must be obtained

through research. The chief techniques for gathering such data

include mail questionnaires, interviews, retail store shelf audits, useof electronic scanners at retail checkout counters, and direct

observation in stores. The researchers design and test research

materials, such as questionnaires or guides for interviewers. Finally,

they collect the data, analyse the information, and report the results

of their study. The computer is an important tool in analysing

market research data. Market research can reduce the risk involved

in many business decisions, but some risk always remains.

Additional resources

Bungum, Jane. Money and Financial Institutions. Lerner 1991.

Gall. Junior Worldmark Encyclopedia of the Nations. Gale

Research, Detroit, Michigan, U.S.A., 1995.


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Rendon, Marion and Kranz, Rachel. Straight Talk About Money.

Facts On File 1992. Guidelines for managing personal finances.

Silk, Leonard. Economics in Plain English. Rev. ed. Simon &

Schuster 1986. Paperback.

Young, Robin R. The Stock Market. Lerner 1991. Explains the

basics of stock market investment.

Backhouse, Roger. The History of Modern Economic Analysis.

Blackwell, Cambridge, Massachusetts, U.S.A., 1997.

Blinder, Alan S. Hard Heads Soft Hearts: Tough-Minded Economics

for a Just Society. Addison-Wesley 1987. Argues in favour of

economic policy that promotes both efficiency and social welfare.

Calleo, David P. The Bankrupting of America: How the Federal

Budget Is Impoverishing the Nation. Morrow 1992. Analysis of the

causes and consequences of the federal deficit.

Friedman, Milton and Rose. Free to Choose. Harcourt 1980.

Argues for free market economy.

Galbraith, John K. Economics in Perspective: A Critical History.

Houghton 1988.

Heilbroner, Robert L. and Thurow, Lester C. Economics Explained.

Simon & Schuster 1994. Discusses international monetary systems,

currency fluctuations, inflation, and unemployment.


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Keynes, John Maynard. The General Theory of Employment,

Interest, and Money. Harcourt 1965.

Smith, Adam. The Wealth of Nations. Random House. 1993.

Thurow, Lester C. Head to Head: The Coming Economic Battle

Among Japan, Europe, and America. Morrow 1992. A look at the

possible future of global economic competition.

Baker, Michael J. Marketing - Theory and Practice. MacMillan,

Basingstoke, Hampshire, UK, 1983.

Bennet, Peter D. Marketing. McGraw Hill, Maidenhead, Berkshire,

UK, 1988.

Butler, J.T.F. Marketing - An Introduction. Oxford Business

Publishing, Oxford, UK, 1990.

Hassan. Global Marketing. Ed 2. Harcourt Brace College

Publishers, Orlando, Florida, U.S.A., 1996.

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