Microeconomics Essay

9740 ECONOMICS FOR BUSINESS Post Graduate Strategic Diploma (Level 7) Submitted to: Finance and Technology Institute of London 2015 Activity one: 1.1Explain the importance of the micro-economic environment to business organisations: Microeconomics looks at how individual players in the economy, such as households and firms, interact. It focuses on the impact that their economic choices have on the allocation of scarce resources to meet unlimited demand. These interactions match what one

How will a firm’s pricing strategy depend on the structure of the market? A pricing strategy is important to any firm in realising its corporate objectives, whether that be its sales revenue, market share or indeed profit, and thus there is much preoccupation within a business about its pricing strategy. Ultimately, this will be guided by many factors; not least the market power it has to set the price of its products and the nature of the demand curve it faces. This essay will attempt to outline

Supply and demand: Markets, Prices and price setting 1. Explain what happens to price and quantity of milk when the following events occur: a. More people start eating cereal for breakfast. The assumption is that if more people start eating cereal for breakfast, the demand for milk will rise because people use milk on their cereal. There are substitutes for milk, including soy milk, almond milk, and other milk-like products. In addition, some people eat cereal without milk, wetting it with

Microeconomic study deals with what choices people make, what factors influence their choices and how their decisions affect the goods markets by affecting the price, the supply and demand. In particular, microeconomics emphasis on patterns of supply and demand and the resolution of price and output in individual markets (e.g. coffee industry). The Micro economy of Australia is one of the largest mixed market economies in the world, with a GDP of US$1.525 trillion as of 2014.Australia 's total wealth

store more of the good and sell less now and a greater quantity in the future. Similarly, a buyers, as N. Gregory Mankiw an economist points out "expectations about the future may affect their demand for a good or service today" (Principles of Microeconomics pg.71). In fact, Elaine's expectations effect her demand for the birth control sponge. Let us explore to the reason as to why her expectation affects her demand curve as

1. A reduction in trade barriers has two effects on the economy. The production possibilities frontier will move outward, and the economy will move closer to the production possibilities frontier. Both outcomes are related. Freer trade creates more markets for the country for its goods and services. This allows companies to produce more, but it does not directly change the production capacity of the nation. Thus, the economy moves closer to the production possibilities frontier (Rittenberg & Tregarthen

1. i) If the price of wool decreases in response to an increase in wool supply, this is graphed as follows. Basically, P drops, which pushes AD to the right, which in English means the quantity demanded increases. Q1 is the original equilibrium point while Q2 is the new equilibrium point. ii) If supply of cotton decrease, the price of cotton increases. Demand should decrease as the result of the price increase, bringing the market to a new equilibrium level (Q2). iii) In this scenario, demand drops

Perfect Competition Perfect competition is an idealised market structure theory used in economics to show the market under a high degree of competition given certain conditions. This essay aims to outline the assumptions and distinctive features that form the perfectly competitive model and how this model can be used to explain short term and long term behaviour of a perfectly competitive firm aiming to maximise profits and the implications of enhancing these profits further. In a perfectly

1. PRINCIPES OF ECONOMICS-MANKIEW CHAPTER 1- QUESTION FOR REVIEW (18) No 3. What is inflation and what causes it? = Inflation is an increase in the overall level of prices in the economy. Inflation happen because culprit is growth in the quantity o money when a government creates larges quantities of the nation’s money, the value of the money. No 5. Explain the two main causes of market failure and give an example of each! = Externality, is the impact of one person’s action on the well being

Economics and the Effects on Our Society Post University Maria Krug BUS501 January 13, 2013 Economics and the Effects on Our Society A crucial topic of discussion that we hear among our fellow co-workers, family, friends, or colleagues is how the economy is affecting our daily activities of living. When stating this, there is much debate and question as to how our money is valued and the effects it poses on various aspects of our purchases