The transfer and redistribution of capital happens through multiple mechanisms and directional flows. Transfers of income from businesses to consumers can occur through the economic redistribution from taxation. Businesses can also sell to consumers who in-turn resell. Businesses also have what is known as a 'trickle down effect' where their income is paid out to workers, who are also consumers themselves.
In a product market businesses make and sell goods to consumers. Consumers use their income to purchase these goods.
Discretionary income is more important to businesses that sell expensive watches, second homes, and financial services. This is because discretionary income refers to the money consumers have left after covering essential expenses, allowing them to spend on luxury items and services. Businesses in these sectors rely on consumers' ability and willingness to spend on non-essential goods, making discretionary income a key factor in their success.
consumers pressured businesses by boycotting nonunion goods.
Cheap website advertising is appealing to both consumers and businesses because of the availability and the price. For consumers the ads are on the sites they visit and for businesses it is a cheap and easy way to reach consumers.
Product market is the place where goods and services are created and sold by businesses. This does not include trading instead focuses on finished goods purchased by the public sector and foreign buyers.
Businesses promote credit to their consumers through the allowing of consumers to purchase products through credit transactions provided by the business.
Businesses that sell directly to consumers on the internet are known as B2C businesses. B2C stands for business to consumer.
Differences in income levels and income distribution among countries significantly impact international businesses by influencing market potential and consumer purchasing power. Countries with higher income levels typically offer more affluent consumer bases, attracting businesses that can afford premium products. Conversely, in lower-income regions, companies may need to adapt their offerings to suit budget-conscious consumers, often leading to the development of lower-cost alternatives. Additionally, income inequality within countries can create niche markets, allowing businesses to target specific segments based on varying income levels.
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Income Elasticity:Income Elasticity of Demand is measure of percentage change in demand for a commodity due to 1% change in income of consumers. Negative Income Elasticity :Increase in Income of consumers lead to decrease in the quantity demanded for a commodity.Example: unbranded items.so if Income Elasticity for product is -0.5 then its demand will be decreases as Income of consumers increases.
Concentration theory in tax shifting refers to the idea that businesses may pass on the burden of a tax to consumers in the form of higher prices. The theory suggests that the extent to which businesses can shift the tax burden to consumers depends on the market structure and the elasticity of demand. If the demand for the product is inelastic, businesses are more likely to pass on the tax burden to consumers.
competition