Search the Internet to research two (2) of the leading competitors in the low-calorie frozen, microwavable food industry, and take note of their pricing strategies, profitability, and their relationships within the industry (worldwide).
Write a six to eight (6-8) page paper in which you:
- Outline a plan that will assess the effectiveness of the market structure for the company’s operations. Note:
In Assignment 1, the assumption was that the market structure [or
selling environment] was perfectly competitive and that the equilibrium
price was to be determined by setting QD equal to QS. You are now aware
of recent changes in the selling environment that suggest an imperfectly
competitive market where your firm now has substantial market power in
setting its own “optimal” price.
that business operations have changed from the market structure
specified in the original scenario in Assignment 1, determine two (2)
likely factors that might have caused the change. Predict the primary
manner in which this change would likely impact business operations in
the new market environment.
the major short run and long cost functions for the low-calorie, frozen
microwaveable food company given the cost functions below. Suggest
substantive ways in which the low-calorie food company may use this
information in order to make decisions in both the short-run and the
TC = 160,000,000 + 100Q + 0.0063212Q2
VC = 100Q + 0.0063212Q2
MC= 100 + 0.0126424Q
the possible circumstances under which the company should discontinue
operations. Suggest key actions that management should take in order to
confront these circumstances. Provide a rationale for your response. (Hint:
Your firm’s price must cover average variable costs in the short run
and average total costs in the long run to continue operations.)
one (1) pricing policy that will enable your low-calorie, frozen
microwavable food company to maximize profits. Provide a rationale for
Assignment 1, you determined your firm’s market demand equation. Now
you need to find the inverse demand equation. Having found that, find
the Total Revenue function for your firm (TR is P x Q). From your firm’s
Total Revenue function, then find your Marginal Revenue (MR) function.
the profit maximization rule MR = MC to determine your optimal price
and optimal output level now that you have market power. Compare these
values with the values you generated in Assignment 1. Determine whether
your price higher is or lower.) - I will provide calculations from assignment 1 as mentioned here.
a plan, based on the information provided in the scenario, which the
company could use in order to evaluate its financial performance.
Consider all the key drivers of performance, such as company profit or
loss for both the short term and long term, and the fundamental manner
in which each factor influences managerial decisions.
profit in the short run by using the price and output levels you
generated in part 5. Optional: You may want to compare this to what
profit would have been in Assignment 1 using the cost function provided
profit in the long run by using the output level you generated in part 5
and cost data in part 3 and assuming that the selling environment will
likely be very competitive. Determine why this would be a valid
two (2) actions that the company could take in order to improve its
profitability and deliver more value to its stakeholders. Outline, in
brief, a plan to implement your recommendations.
- Use at least five (5) quality academic resources in this assignment.