Tata Stimulation Game Essay

1292 Words Jan 6th, 2013 6 Pages
The strategy simulation game is to provide insightful information with different scenarios which help in understanding the differences in different market structures of monopoly, oligopoly, monopolistic competition, and perfect competition. The overall goal of the simulation games is to maximize Quasar’s profits and be competitive by making decision on strategies in dynamic market conditions. Simply, the total revenue minus the total costs is the method to calculate a firm’s profit. However, the company also has to consider how the sales price will affect the demand. The simulation game shows that when the price is set too high, the demand will be low, vice versa. When the company set the price within the average total cost curve and …show more content…
The second scenario is to determine how the production processes can affect the company profit. When the demand rises, I think that upgrading production process in machineries can improve the operation efficiency and effectiveness. Therefore, I choose to upgrade the production process and reset the price at $2200 which generates $2.21 profits with 9.4 million units in demand.
Advertising is the most effective methods to increase sales and detailed planned marketing strategies can assist companies in reviewing their existing position with foresight long term competitive advantages (Dibb, 2002). Long-term brand value creation through advertising has positive effect on brand choice because “advertising is used to inform consumers about features and benefits, to strategically position a brand and to build awareness” (Jedidi, Mela, & Gupta, 1999; Low & Mohr, 2000, p.3). This reflects that the simulation game’s demand changes according to the advertising investment made. If the advertising budget is reduced, the demand shows reduction too. Advertising acts as a communications platform that educate customers about the company and the products which generate more sales (Kotler & Keller, 2009).
Upgrading production process can be done in two ways. One way is through upgrading existing tangible resources such as equipment and supplies, and the other way is to upgrading through intangible resources such as

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