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Assignment Business Economics: Profitability and Production

   

Added on  2020-05-28

10 Pages2494 Words129 Views
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Student NameBUSINESS ECONOMICS: MONITORINGANDCHARTING PROFITABILITYAND PRODUCTION
Assignment Business Economics: Profitability and Production_1

ContentsIntroduction.................................................................................................................................................1supply and demand diagrams show the effects of the following changes in the price and quantity of cars:2An increase in the price of petrol.............................................................................................................3A rise in incomes.....................................................................................................................................3A rise in wages for care workers and a fall in the price of bus tickets (both at the same time)................3Explain, using a diagram (or diagrams), why firms maximize profits where marginal cost equals marginal revenue........................................................................................................................................................4Short run production decision - Perfect Competition...................................................................................6Explain why monopoly results in a welfare loss compared to a perfectly competitive market....................7Conclusion...................................................................................................................................................8References:..................................................................................................................................................9
Assignment Business Economics: Profitability and Production_2

IntroductionAs the number of businesses increases, the demand for businesses to determine their profitabilityis also rising. This makes it important for the businesses to adopt and use suitable sales,production and profitability reporting strategies which will ensure the business secures the mostprofit from the transaction[ CITATION Gra14 \l 1033 ]. The following report shall highlight differentcharting techniques a business can utilize to improve its profitability and allow the businessessecure the best returns on its transactions and sales.Supply and demand diagrams show the effects of the following changes in the price andquantity of cars:The supply and demand curve is the important indicator and delivers a direct visual correlationbetween the effects of rising prices on the number of products demanded by the customer. As theproduct cost and maintenance increase, the demand for the products will automaticallyreduce[ CITATION Jac05 \l 1033 ]. Supply and demand curves also have a tendency of increasing orreducing in demand based on certain influencing factors also known as shifters. The followingfactors have been directly associated with the shift in demand:1.taste and preference for products and services2.number of consumers in the market3.price of related products and services4.consumer income levels5.consumer expectationsEach of these shifters will have a direct effect on the supply and demand curve and result in theincrease or decrease in demand for the products or services.
Assignment Business Economics: Profitability and Production_3

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