Monopoly is where only one company is providing a good and or service. Businesses may maximize profit in each market type by agreeing upon a lay down price. Perhaps businesses cannot agree upon a set price then the price is going to be above marginal cost. If the company is in competition with other companies in the same market, making decisions about prices, how they advertise, output, etc, can influence the profits of every, if not all companies in the same market. This is where management gets involved to ensure the company that their strategic way of thinking and planning can and will allow the company to gain
Differentiating between the market structures of this business will allow for explanations of how different sectors of industry will vary and how to come up with some competitive strategies to grow the business within the industry. Market Structure Target is within the oligopoly market structure. Oligopoly, according to Colander (2013), a market structure in which there are only a few firms and firms explicitly take other firms’ likely response into account. Being that there are only a few different businesses like Target, they tend to set their prices according to the rivals. This practice keeps these businesses in the oligopoly market structure.
(2012). J.C. Penney’s risky new pricing strategy. Harvard Business Review. Retrieved from ProQuest. Review the article: Is your own buying behavior influenced by coupons and sales?
By following the matching principle all of the costs associated with a particular product, not just its wholesale price, is expensed when the item is sold. Requirement 2 - A Generally, the lower of cost or market method is used to value inventory in order to “avoid reporting inventory at an amount greater than the benefits it can provide” (Spiceland, Sepe, & Nelson, 2013, p. 476). According to Spiceland, Sepe, and Nelson (2013) the “change in replacement cost usually is a good indicator of the direction of change in selling price” (p. 477). When the change in replacement cost is negative the LCM method allows companies to apply the conservatism principle. The conservatism principle involves “recognizing expenses and liabilities as soon as possible when there is uncertainty about the outcome, but to only recognize revenues and assets when they are assured of being received” (The conservatism principle).
Market structures are referring to “the physical characteristics of the market within which firms interact,” (Colander, 2010). Monopolistic competitive are markets in which there are large amounts of firms selling differentiating products and there are few barriers to enter. Kudler Fine Foods falls into this category because there are numerous different grocery stores; however, they have a variety of different goods. Kudler Fine Foods would be competing against other fine food stores like Whole Foods, Trader Joes, and World Market. For Kudler Fine Foods to fall into this category means that they sell differentiating products from their competitors.
Define the price elasticity of demand and show how it is calculated. Answer: The units-free measure of the responsiveness of the quantity demanded of a good to a change in it s price when all other influences on buying plans remain the same. 3. What is the total revenue test? Explain how it works.
MGMT 4020 June 24, 2013 Homework Assignment #2 Competition is very high in the North American wholesale club industry. Every wholesale club wants to sell top-quality products at prices less than others in order to attract draw customers. And they all want to display low prices on pallets or inexpensive shelving, therefore, they have very low costs for store decor and fixtures, have comparatively low labor costs, and spent minimally on advertising and customer service. Five Forces Analysis 1. Bargaining Power of Buyers is moderate.
Demand Schedule-A listing that shows the various quantities demanded of a particular product at all prices that might prevail in the market at a given time. Demand curve- A graph showing the quantity demanded at each and every price that much prevail in the market. Law Of Demand- A law that states that the quantity
In the next chapter we learn how sellers set the prices in which we pay for an item, why things cost what they do and not what they are worth. The key to prices are sellers that can sell their products as close to the cost of making the item. In a regular market, prices are the key. Businesses cannot afford to charge a higher price, customers are normally looking for a lower price and the lower the better, in today’s economy. Many customers ask the question, “What affects prices?” We learn that things happen beyond the sellers’ and buyers’ control to raise and lower prices in today’s market.
National business is a business which is located in the whole country. These types of business normally franchise this is means the governments allows the owner to sells their product or service. International business is a business which is located in more the one country. An example of this would be Tesco or McDonald’s because they’re both located in different countries such as America and England. Size and Scope of Business Small size and scope businesses are normally privately owned or sole traders this is because they have a small amount of employees which means they can’t afford to have more in a small shop.