(a) What is market? (b) Explain four ways by which market-ing is important to the economy (c) State five functions marketing.

Answer Details

(a) What is a market?

A market is any arrangement, place or medium through which buyers and sellers are brought into contact to exchange goods and services at an agreed price. It need not be a physical location; it exists wherever communication between buyers and sellers allows a transaction to take place (for example, telephone or internet markets).

(b) Four ways marketing is important to the economy

1. Bridges the gap between producers and consumers. Marketing ensures that goods produced reach the final consumers who need them, creating place and time utility.
2. Creates employment. Marketing activities such as selling, advertising, transport, warehousing and packaging provide jobs for many people.
3. Stimulates production. By selling output and studying consumer wants, marketing encourages producers to make more and better goods, raising national output.
4. Raises the standard of living. Marketing makes a wide variety of goods and services available to consumers at convenient places and times, improving welfare.

(Also acceptable: it generates income and government revenue; it promotes trade and economic growth.)

(c) Five functions of marketing

1. Buying (assembling goods for resale).
2. Selling (finding buyers and transferring ownership).
3. Transportation (moving goods to where they are needed).
4. Warehousing/storage (holding goods until they are demanded).
5. Financing and risk-bearing (providing funds and carrying the risk of loss).

(Also acceptable: grading and standardisation, advertising and market research.)