Simulation Analysis
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- Date Submitted: 09/18/2012 03:42 AM
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Simulation Analysis
This paper will provide understanding of decisions that are made in each type of market structures and the impact of those decisions. Examples of pricing strategies that succeeded in maximizing profits and how decision-making differ among the market structures of monopoly, oligopoly, monopolistic competition, and perfect competition will be defined. It will also use strategic variables to maximize economic profits, identify pricing and non-pricing strategies; allocate funds for technology, research, development, innovation, and efficiency.
In 2003, being the pioneer with the design and manufacturing of an optical notebook computer; Quasar lead the way in the computer industry. Having a patent for three years, Quasar had a monopoly on optical computers. If Quasar sells 5.3 million computers at a price of $2550 their total profit will be $1.29 billion which can be the maximum profit where marginal costs equals marginal revenue (University of Phoenix, (2012).
By 2004, quasar reviews the advertising budget and the impact on promotional activities on demand, price, revenue, and profits. A $600 million budget increase is recommended by Robert. He thinks volumes will rise and profits will increase if the company invests in brand building. Consumers will have to buy 7.7 million of computers at a price of $2450 each in order to have a profit of $2.74 million (University of Phoenix, (2012).
In 2005, Quasar reduces production costs by streamlining the manufacturing facilities, so David recommends an upgrading of the production process. He thinks that during the production process, the amount of waste increased the production costs. In his opinion, upgrading the machinery and production process will result in the reduction of cost per unit. If the computers are sold for $2200, 9.4 million would have to be bought in order to have a total profit of $2.21 billion which will be the maximum profit point. Jane’s opinion is that with the lack of competitors,...
This paper will provide understanding of decisions that are made in each type of market structures and the impact of those decisions. Examples of pricing strategies that succeeded in maximizing profits and how decision-making differ among the market structures of monopoly, oligopoly, monopolistic competition, and perfect competition will be defined. It will also use strategic variables to maximize economic profits, identify pricing and non-pricing strategies; allocate funds for technology, research, development, innovation, and efficiency.
In 2003, being the pioneer with the design and manufacturing of an optical notebook computer; Quasar lead the way in the computer industry. Having a patent for three years, Quasar had a monopoly on optical computers. If Quasar sells 5.3 million computers at a price of $2550 their total profit will be $1.29 billion which can be the maximum profit where marginal costs equals marginal revenue (University of Phoenix, (2012).
By 2004, quasar reviews the advertising budget and the impact on promotional activities on demand, price, revenue, and profits. A $600 million budget increase is recommended by Robert. He thinks volumes will rise and profits will increase if the company invests in brand building. Consumers will have to buy 7.7 million of computers at a price of $2450 each in order to have a profit of $2.74 million (University of Phoenix, (2012).
In 2005, Quasar reduces production costs by streamlining the manufacturing facilities, so David recommends an upgrading of the production process. He thinks that during the production process, the amount of waste increased the production costs. In his opinion, upgrading the machinery and production process will result in the reduction of cost per unit. If the computers are sold for $2200, 9.4 million would have to be bought in order to have a total profit of $2.21 billion which will be the maximum profit point. Jane’s opinion is that with the lack of competitors,...