MBA 5010 Week 3 Assignment: Market Demand Analysis Techniques

MBA 5010 Week 3 Assignment 2021 The weekly assignments are intended to be completed individually. It is important in an online program that you pay careful attention to when it is and is not appropriate to work with peers. Misunderstandings can have significant consequences. By submitting this assignment, you are attesting that you completed this work without assistance from another current or former student of this class. Exceptions can be made for tutors, but only with prior consent from your instructor. Your answer will be evaluated based on correctness, completeness, and clarity. Be attentive to your writing. You have until midnight CST Sunday to submit both parts of this assignment. Part A (25 points) The following companies and scenarios are fictional. In each case, you are to demonstrate graphically the change in the model and then provide a hypothetical explanation of what happened. If you have trouble with changing graphs in Word, reach out to your instructor. All assignments must be submitted as Word files. Example – Capn’ Mark’s Seafood price is falling even while sales are growing. Capn’ Marks Seafood has developed a new technology that allows it to “grow” seafood chunks using genetic engineering. This new technology means Capn’ Marks can supply fast food restaurants with seafood patties at half the price of its competitors. The result is a 40% increase in sales.

Question 1 – Becky’s Bongos sales are falling even while they continue to decrease price. Supply $ New P1 D1 Demand Q1 Q0 Qty Respond here Assuming Becky’s Bongos are a normal good, an income decrease such a demotion or a job loss (income being one of the determinants of demand) may affect the quantity demanded by a consumer. With less money to spend in the future, a consumer may not be willing to buy bongos at this time. The demand curve will decrease (shift left/D1 in figure above) and create a new equilibrium price (p1). Question 2 – Todd’s Tiaras has seen a significant uptick in same-store sales and has been able to completely eliminate discounting. p0

$ Supply New p1 Demand D1 Q1 Q1 Qty All things being equal at Todd’s Tiaras, the increase of in-store sales may have occurred if it is High School Prom season and demand for tiaras rises, (determinant change was taste/preference) and increase of quantity demanded shifted to the right (see to D1 below); New equilibrium price rose from p0 to p1. Question 3 – Fast Freight, an interstate trucking company, has had to raise price three times in the past year, significantly reducing sales. p0

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$ Price Increase #3 Supply $500 $450 $400 $350 Price Increase #2 $300 Price Increase #1 $250 $200 $150 $100 $ 50 Demand $ 0 Q3 Q2 Q1 Q0 Respond here Fast Freight may be having to raise their prices due to “factor costs” increasing such as increase gasoline prices. Higher prices are passed on to their customers to cover their costs. The change above is movement down along the demand curve not a shift in quantity demanded or quantity supplied. This is the perfect example of the Law of Demand: as prices rise, demand decreases. The price increases in figure above (blue dots) demonstrate new demands points moving down and decrease in demand from Q0 to Q3. For the following questions, utilize a diagram for each market to demonstrate the respective effects of the described event. Afterward, verbally describe your response.

Example – The appreciation of the Taiwanese currency has increased the price Foxconn must charge Apple and other clients for manufacturing electronics. This has benefited their Indian competitor, Majumdar Ltd, who has picked up Foxconn’s lost sales. The currency appreciation increases Foxconn’s cost causing supply to shift leftward. Majumdar, Ltd sees an increase in demand as customers switch from Foxconn to Majumdar. Question 4 – A substantial decrease in this year’s wheat crop has led to a sharp increase in sales of corn. Respond here Question 5 – The devastating effect of the Covid-19 virus on the cruise industry has decimated the economies of many Caribbean island nations.

Respond here Part B (25 points) This week you are to complete a fully complete draft response to the following. You are to complete this draft without assistance from either current or former MBA 5010 students. This draft response will be evaluated on completeness and clarity but not graded for content. Next week you’ll be given an opportunity to collaborate with your peers to complete a final response. Consider if there should be a market for organs -specifically kidneys. In the United States, it illegal to sell kidneys. Explain how this is in essence like the government has imposed a price ceiling of zero on the market for kidneys, thus creating a shortage. Discuss how a free market for organs such as kidneys might result in benefits. What value might be created from a free market for kidneys. Specifically discuss how sellers might be better off and how buyers might be better off. Would this lead to an efficient allocation of resources? Are there any other issues to consider if there was a free market for kidneys such as fairness.(e.g., would only those most willing and able to pay for a kidney be the ones that benefit).

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MBA 5010 Week 3

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