Sample answer to this question: Explain what is meant by a market and by sub-markets

1. Markets and
Sub-Markets
A Level Microeconomics
Tutor2u Economics

2. Question: Explain what is meant by a market
and by sub-markets
A market is anywhere where buyers
and sellers come together to transact
with each other. The buyer and seller
don't have to be in the same place in
order to conduct transactions with each
other – many businesses now operate
on digital platforms such as Amazon
marketplace and eBay. The forces of
supply and demand in markets such as
agricultural products are crucial in
establishing market prices and perhaps
reaching an equilibrium i.e. a market-
clearing price where supply = demand.

4. Question: Explain what is meant by a market
and by sub-markets
A market is anywhere where buyers
and sellers come together to transact
with each other. The buyer and seller
don't have to be in the same place in
order to conduct transactions with each
other – many businesses now operate
on digital platforms such as Amazon
marketplace and eBay. The forces of
supply and demand in markets such as
agricultural products are crucial in
establishing market prices and perhaps
reaching an equilibrium i.e. a market-
clearing price where supply = demand.
The market for most goods and services
can be broken down into sub-markets
which tailor to the different needs and
wants of groups of consumers. For
example the market for new cars might
be broken down into the market for
electric and hybrid vehicles as well as
petrol and diesel-powered cars. In the
housing market we can distinguish
between residential and commercial
property. A global pharmaceutical
company might consider sales in each
of their submarkets by country.

7. Markets and
Sub-Markets
A Level Microeconomics
Tutor2u Economics