We also must assume that the market of BioMed can be modeled as being perfectly competitive in equilibrium, allowing the use of the model’s profit maximizing criteria. The plant producing DermaPlusTM has been in operation for three years with no change in manufacturing equipment. The age of the equipment has not proven to have an impact on current or future production of DermaPlusTM based on the information provided. DermaPlusTM will be under a new reference-based pricing scheme which will allow the government to set the price of BioMed’s topical cream along with competing creams. The government will review the pricing every two years, leaving only the production and selling volume to be determined by the manufacturer.…
If consumers were willing to pay the high prices for these produces the market will become competitive and the business will start making different strategies to allure consumers in their direction. This competition will start bringing the prices of the produces down, but it is important that business understand that they need to set up a line before bringing the price too low and hurting the market permanently. Because some businesses have been careless about this, other businesses have suffered and they have gone…
Market niche is also a strategy adopted by the companies which compete with generic products and are concerned with cost reduction. (Appendix C) As the case mentioned, Distillers Delight had a lot of competitors, including some huge international corporations, who compete so rigorously with Distillers Delight, such as Diageo plc. Per nod Ricard, Bacardi Limited, Allied Domecq, Constellation Brands.(Appendix D) Consequently, the company should consider about the cost reduction while compete with other companies. However, when the excise tax was raised by the government, the sales of Distillers Delight declined sharply as the cost reduction was not used immediately after the implementation of the new tax policy. (Appendix E) It also represents the adoption of market niche strategy.…
The benefits that governments receive from the regulation that are made by them can be social and economic. Firms in oligopoly markets can make the market harmful, so these rules are the most effective solution to reduce the…
the government or local authority the depth of public feeling against decision. A good example of this would be the rallies and protests organised by the Countryside Alliance since the UK government placed a ban on foxhunting.…
Describe the government and domestic environment of the country where your company is headquartered, then describe the international environment. Outline what organizations you may be associated with. (Example; WTO, OPEC, etc.)…
Throughout American history there has been an extravagant amount of change from where things once were. Government intervention has revitalized the economy of the government and has prevented any massive destruction to our country. Without intervention our country would not be where it is currently. The advancements in technology, un-abusive labor, and safety can all be credited to intervention. Without a plan in place there is no objective to be accomplished. When plans are created, this as a result leads to progression.…
The unexpected change posed many impacts on an abundant area of the population. The change impacted the consumers (smokers), the suppliers/producers, retailers/tobacconists, charity workers and the government. The sudden publication of the price increase would lead to a majority of smokers purchasing larger amounts of cigarettes than usual, in an attempt to purchase the product at a cheaper price rather than at its increased price. The retailers/tobacconists face the prospects of higher demands and physical…
Social Responsibility refers to the loyalty of the executives of a company to important social objectives as opposed to shareholders, employers, and owners. A socially responsible company is much more likely to try to keep customer service high and prices lower, even though increasing prices would be in the better interest of the business. It is important for the economy because a socially responsible business positively influences the economy. Consumers will want to be patrons of socially responsible business, and people will want to work for an ethically sound business.…
Recently, there has been a debate as to whether government intervention is necessary in order to preserve and regulate economic changes within an economy. In the source, Ronald Reagan states that “the problem is not that people are taxed too little, the problem is that government spends too much.” Through this source, it is evident that Reagan in an advocate of supply-side economics as he believes in the natural regulation of the economy through demand and production. Furthermore, he is not in favor of government intervention of the economy as he believes that during times of economic recessions “the government spends too much.” As a supporter of supply-side economics, Reagan strongly believes that taxation should be dramatically reduced for…
The issue of obesity is becoming worse in America, and there are many different opinions about how to solve this situation. One of the most arguable opinion is about government intervention. Experts who suggest government intervention focus on the epidemic of obesity and unethical ploys of the food companies such as indeterminate modifiers. They think the government should intervene to protect people. However, other experts who disagree claim obesity is a personal problem. They also warn about the ineffectiveness of regulating unhealthy foods. Although some experts say that the government intervention is not a good solution to obesity problems, the government should consider intervening, because counterbalances for the prices between healthy and unhealthy foods are needed, and because of the poorly-regulated unethical ploys that customers are unaware of.…
Public policy is both the written and unwritten laws of a society that suggest the moral, ethical and social behaviors of people (Capalli, 1997, p. 393). Some public policies are common understandings among a group of people that exist in a particular locale, while other public policies affect the whole of society within a certain nation. Public policies guide a society in the direction that the people believe that it should be headed. However, because economic and social factors are constantly changing within the social order, public policies change as well to meet the varying needs and goals of the people. When unwritten public policies are formally documented it is to ensure that the policies within a society are enforced and that there is a universal support for the public policy, regardless of objections to it.…
To steal share in low-income market, the new product should provide middle quality with low price. While consumers prefer cleanliness and smell, they don’t pay much attention to dissolving power and harm to colors. So while Unilever should maintain middle quality in highly preferred attributes in the new product, the company can decrease cost by reducing quality in some attributes which are not so important for consumers. By doing so, the new product can position itself in low price and middle quality, then Unilever will be able to steal share from Invico and Pop. The new product may take share from Campeiro, however the new product maintain the same margin with Campiro, so this cannibalization will not worsen the company’s profitability. The new…
In depth, according to the textbook, there are two goals for the government to place taxes on a company or consumers. The first one as previous stated is to raise revenue and this type would be the most beneficial when the supply is inelastic. The second goal is to change a consumer or company’s behavior in the market and it is most effective with supply is elastic.…
Economics is defined as the study of how the forces of supply and demand allocate scarce resources. Economics can be subdivided into microeconomics, which examines the behavior of firms, consumers and the role of government; and macro economics, which looks at inflation, unemployment, industrial production, and the role of government (Investor Word, 2008). Economics can be further divided to include positive economics and normative economics. Positive economics is the study of what is, and how the economy works and normative economics is the study of what the goals of the economy should be. Simply put positive economics looks at how things such as current gas prices directly affect individual buying power and how that buying power affect the economy as a whole. Normative economics looks as how the economy would be affected if certain practices were put into play, for example; if government was implement a law stating for every five gallons of gas a individual purchases he or she would be given one gallon free of charge.…