Managerial Economics and Pricing Policy of McDonalds

Management
Economics

Contents
INTRODUTION.........................................................................................................................................3
MAIN BODY..............................................................................................................................................3
Introduction of Product............................................................................................................................3
Identification of Demand and Market Equilibrium under influence of External Factors.........................3
Identifying Price Elasticity of Demand....................................................................................................6
Pricing policy of McDonalds...................................................................................................................7
CONCLUSION...........................................................................................................................................7
REFERENCES............................................................................................................................................9
Books and Journals..................................................................................................................................9
Online......................................................................................................................................................9

INTRODUTION
Managerial economics is that stream of management whose studies focuses over
solving business problems and decision making in businesses as well using concepts of
economics and management. Managerial economics is a specialized study that, while using
theories and concepts of economics, stresses on solving internal problems of businesses
(Managerial Economics, 2018).
In this report, concepts of Managerial economics and their utility are studied and
discussed with regards to Fast food products of McDonalds. In this report, study of role of
Managerial economics are studied in a manner to demonstrate performance of fast food products
in market. Identification of market equilibrium and demand under the influence on different
external factors is included in this report. Also, factor that influence on price elasticity of demand
are also discussed. And, at last suitable pricing policy for fast food products of McDonalds is
developed.
MAIN BODY
Introduction of Product
The chosen products for this report is the fast food products of McDonalds. The worth
that they have is that this chain of fast food restaurants is one of the most leading chain of
products of this category in market and its products are those among the top list of food lovers.
McDonalds is a chain of restaurant that offers a uniform menu for its consumers, includingfries,
the Big Mac, chicken sandwiches, chicken nuggets, hamburgers, the quarter pounder with
cheese, salads, wraps, desserts, soft drinks, and other beverages. The company makes its top
priority that its products can have global acknowledgment and outreach to every single consumer
in the world. Food products with local flavours are also offered by consumers. In a manner that
after globally recognized products of McDonalds reaches a particular region they adopt
traditional cuisines of that country in itself, and offers consumer a product that is unique in itself.
For example, gazpacho in Spain, the black and white burger in China, and the Veg Pizza McPuff
in India. But the globally spread and well recognized chain is not free of its competitors and the
most competitive rivalry is offered by Burger king of United States of America.
Identification of Demand and Market Equilibrium under influence of External Factors
Demand and Market Equlibrium are two most important concepts of Microeconomics,
influencing many policies and decision making processes in McDonalds. Demand is the quantity
of fast food products that consumers in market are willing to buy from McDonalds at a given
point of time and on different prices of its products. And, Market Equilibrium is that position in
market which is established when McDonalds is also ready to supply its products at which
consumers are agreeing to buy. Therefore, it is position of match between supply and Demand of