As the costs of consuming Petrol and Diesel are not fully taken into account by the consumer, the difference between the social costs and private costs results in a negative externality. Negative Externalities occur when an economics activity affects third parties; those not directly involved in the making of a decision. As producers are only interested in maximising profits; they only take into account private costs and benefits that arise from their decisions. Therefore they would supply a higher amount than optimum that would result in an overproduction at Q1. As the producer creating the externality does not take it into account and the consumer does not fully pay for the resulting externalities, market inefficiencies result in the form of market failure.
They make their own prices, which would in most cases be more of a benefit to the producer. Both structures make it very difficult for others to enter the industry, limiting and sometimes blocking entry and competition. Industrial Regulation seeks to prevent unfair practices of restricting market entry, opening markets up for competition. Ideally, prices with regulate themselves in a fair competition, preventing one or a few companies from setting the prices that would be deemed as inappropriate. It also works to prevent the practices of unfair pricing and charging higher prices to consumers while the companies produce less product, limiting choices for consumers.
One of the biggest issues would be incentives and commissions. Sales representatives would lose some of their commission if they were to take in Company A’s leads whereas Company B, being the originator of the leads, would have a potential for higher commissions. This may cause sales personnel to steal leads from Company A and convert them to Company B leads. This activity would also have to be closely monitored. As for the customer service representatives, they do not get any incentives because they are paid on salary and do the same work as the sales department.
Export commodities which have been banned from sale in the United States No, a business shouldn’t be able to export commodities that have been banned from the United States. There are reasons that these products have been banned whether its drugs, chemicals or some other product it most likely causes harm to individuals or has some kind of danger to it. Although a company’s main concern is making a profit they still have other responsibilities that also contribute to their profits that they receive. Everything a business does reflects on them in either a good
Describe the main characteristics of typical customers that you deal with. Identify what impresses your customer and what annoys your customers. Identify who’s who and who does what to deliver customer service in your organisation. Describe the kinds of information you need to give good customer service to customers. Unit Ref.
It is also possible that managers do not adopt maximising behaviour at all, perhaps “satisficing” in response to shareholder discipline or that the policy of the firm is the result of complex interactions between various stakeholders. An For a firm to profit maximise, it would be the case that it sets output where marginal cost is equal to marginal revenue. If an additional unit of output were to be produced beyond this, it would add more to the firm’s costs of production than its revenue, thus reducing profit. The diagram below shows profit maximising output and the corresponding price, read from the demand curve. It also shows some other possible objectives for the firm.
* Name brand loyalty is very rare in this market, and customers react to price first and then perceived quality. * Difficult to estimate the consumer's taste and opinion levels. * Potential drain on profits coming from reacting too quickly in a market where varying market conditions create a What their hopes and dreams are for themselves and their families. This balance sheet effectively limits alternative 3, since Greywell is not in a fiscal position to make a move. Whereas the latter directs the organization to design its strategies only after the needs of current and potential partners have been assessed, the former aggressively seeks buyers for short-run benefits (Berry, 1983,
The vendor will be function in effort to make a profit as is with all businesses. The problems can come when the vendor needs to increase profit and since the contracts are normally a fixed price, the only way for them to do so is to decrease expenses. This is a viable option as long as they meet the conditions specified in the contract (Bucki, 2012). When outsourcing to another company, your organization is now tied to the financial well-being of the vendor. The problem can arise when after contracting out the IT functions of the organization and paying the fees negotiated, the vendor goes bankrupt leaving the companies who have contracted to them without an IT resource (Bucki,
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.
Welfare: Prevents non-rich from accessing needed goods, but incentivizes suppliers to send more b. Liberty: Diminished purchasing power diminishes reach of freedom of buyers, but allowing “gouging” respects freedom of retails to sell at the price the market dictates c. Virtue: “Gougers” seem to be taking unfair advantage of customers, which seems to be a mark of less than admirable personality traits – greediness, selfishness, a lack of compassion, etc. 2. Refusing to award the Purple Heart to Veterans suffering