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Financial and Economic Literacy for Managers Solution Assignment

   

Added on  2021-01-02

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Financial and EconomicLiteracy for Managers
Financial and Economic Literacy for Managers Solution Assignment_1

TABLE OF CONTENTS1. Discussing notion that pursuit of profit maximisation is consistent with consumersovereignty with business economic concepts or models and practice.......................................12. Critical examination of market structure, demand and supply...............................................33.a Compare and contrast wealth and profit maximisation.........................................................53.b Discussing statement that wealth maximisation is superior to profit maximisation.............54 Application of business economic concepts of environmental policy, fiscal policy, supplyside policies with reference to UK government to seek country's economic prosperity............65.a Calculating current ratio, quick ratio, debtors payment period and stock turnover .............75.b Calculating present value......................................................................................................85.c Calculating net present value................................................................................................8REFERENCES..............................................................................................................................10
Financial and Economic Literacy for Managers Solution Assignment_2

1. Discussing notion that pursuit of profit maximisation is consistent with consumer sovereigntywith business economic concepts or models and practiceConsumer sovereignty is very important concept as it has been assumed that consumershave presence of ability and freedom for selecting among different firms and suppliers. Withreference to this theory, consumers would imply discretion for selecting cheapest and bestquality goods. This rewards the efficient firms and encourages to give goods consumers wantand while describing the operations of market economy as it engages consumers selecting thecertain goods and rewarding organization who generates goods which are in demand. The onewho cannot win over the consumers would either improve goods they offer or goes out frombusiness. The consumer, not that firm or government planning apparatus and identifies what isgoing to be generated (Tadajewski, 2018). The business which generates something that is notwant of consumers would not survive in business for long. Consumer sovereignty is replicated asauthority of consumer to identify what is generated via purchase of services and goods. Thisdictates what services and goods would be produced.1
Financial and Economic Literacy for Managers Solution Assignment_3

Illustration 1: Consumer Sovereignty(Source: Concept of Consumer’s Sovereignty, 2019)With context to free market or private enterprise economy , every production factorowned through private individual and decisions through numerous interaction of market forces.It has been assumed that consumers are always rational and attempt for increasing there utilitywhich they retain through income and entrepreneurs are rational which attempts for maximisingthe margin. The customers are free for purchasing as per their wish in market place as demand ofgood raises then their prices would also rise, making it more profitable and entrepreneurs gainhigh profit in respond to entering production of goods and increment in supply. Thus, more ofgoods for which customers have directly reflected preference are generated production with2
Financial and Economic Literacy for Managers Solution Assignment_4

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