XYZ Corporation operates in a perfectly competitive market. Due to robust economic growth XYZ corporation made above normal profits. Taking into account the characteristics of this market, explain what will happen to
ââ?¬¢ The number of firms in the market
ââ?¬¢ The market supply curve
ââ?¬¢ The market price and output level of products
ââ?¬¢ The profits of the firm
ââ?¬¢ The output produced by the firm
XYZ Corporation operates in a market that produces a homogeneous good. The firm is a price taker and the market price of the product is $14. The firm is currently producing 52 units of output, marginal cost is $17, average total cost is $15 and average variable cost is $9.
a) Do you consider that the firm made a profit-maximizing decision? Explain why or why not.
b) If you answered no in question a, what operational decision should the manager of the firm make? Justify your answer.© BrainMass Inc. brainmass.com October 17, 2018, 3:33 am ad1c9bdddf
1. Since firms are making higher profits,
a) Since there is no barrier to entry (because the market is competitive), everyone wants to make money, so they enter as new sellers. Number of firms increase
b) Obviously, when more firms enter, the supply increases. Supply curve shifts up.
c) More ...
Competitive markets are scrutinized.
International Business Competitiveness
1. What are the characteristics of corporate strategy? What are the characteristics of business strategy? How do these differ? Provide an example of each strategy.
2. Identify the 5 Forces in Porter's Industry Analysis Model. Then discuss three important factors for each force
3. There are many goals corporations may have. Identify two goals and provide examples of each. Then discuss how the strategy of the corporation is different as they follow each of the two goals.
4. As companies develop international strategies they can take different structures. Your text and the slides for the course identify several structures. Please discuss in detail three of these and how they differ.
5. "The fact that so many companies that have been outstandingly successful in their home market have failed so miserably in their overseas expansion demonstrates the complexity of international management." Please comment on this statement using models and theories from the class in your discussion.
6. There are many reasons a firm may choose to diversify. Please identify two of these. Then comment - with examples - on why a firm would diversify
7. One of the most common tools used to analyze the portfolio of a diversified company is the Boston Consulting Group (BCG) matrix. Please identify the components of this model. Then - discuss in detail the pros and cons of this model?
8. The text and the lectures identify three generic strategies. Please discuss all three of these and the differences among them. Be sure to provide an example of each strategy.View Full Posting Details