Differentiating Between Market Structures Paper on Kudler Fine Foods

1063 WordsJul 9, 20135 Pages
Differentiating Between Market Structures on Kudler Fine Foods ECO/365 University of Phoenix Week 4 Individual Assignment March 11, 2013 Differentiating Between Market Structures The analysis will apply important microeconomic concepts toward the competitive strategies of the Kudler Fine Food Virtual Organization, which affect its long-term profitability. The analysis will evaluate the differences between market structures and review the organization’s strategic plan, marketing overview, market surveys, and other material to evaluate the organization’s competitiveness in the marketplace, including its customers’ views. The analysis will identify the market structure that best applies to the organization, and assess how the…show more content…
The firm's profit maximizing output is less than the output associated with minimum average cost. The firm’s demand curve is not flat but is downward sloping. Thus in the long-run the demand curve will be tangential to the long-run average cost curve at a point to the left of its minimum. The result is excess capacity.” Also according to Investopedia (2013), “These types of firms are inefficient; it is usually the case that the costs of regulating prices for every product sold far exceed the benefits of such regulation. However, it would not have to regulate every product and every firm just the most important ones.” A firm could be said to be marginally inefficient because it produces at an output where average total cost is not a minimum. This type of market is a productively inefficient market structure because marginal cost is less than price in the long-run. Markets are also inefficient as the price given is higher than marginal cost. The competitive strategies the analysis recommends are as follows: 1) Continue with plans to automate inventory and ordering systems, 2) Hire someone with financial background to help Kathy, 3) Develop a website and ordering system, 4) Develop the catering side of the business, 5) Finish site location for Carlsbad store, 6) Open Carlsbad store and close Del Mar

More about Differentiating Between Market Structures Paper on Kudler Fine Foods

Open Document