The whole activity should take no more than minutes. Overview Teams are given a list of goods and asked to identify what they think are the most elastic and least elastic in terms of their price elasticities of demand. Expected Student Learning Outcomes Know the definition of a price elasticity of demand and approximate the elasticities for a wide range of products.
Information Given to Students Consider the following products: A. Airline travel, long-run one year First rank the items from those with most elastic demands to least. Make sure to define price elasticity of demand formally or informally before the activity starts. Because many clickers and polling systems only support five choices, instructors may have to do something different with this exercise's six items.
The team report can either be in bold Sharpie ink on scratch paper or on white boards if these are available. After the first report, instructors should ask reporters to explain the reasoning behind their choices, beginning with any teams that just seem confused and moving on to teams that seem to better understand the concept of elasticity.
Having a reporter who hasn't yet spoken explain why another team's answer might be mistaken is a good way to get discussion going.
You may want give reporters a chance to change their answers. It's important not to give too much guidance during the first set of reports most elastic goods and save the in-depth discussion for the second set. In closing, make sure to describe the determinants of elasticity: Time, availability of substitutes, and expenditure share. In this case, the organization products are mainly complimented with internet and other cable organization products.
The products heavily control the demand of Microsoft windows products both negatively and positively. Change in the production costs affects the supply of Microsoft windows products. For instance, if the production cost decreases, the supply of the products will increase. Technological alterations also affect the supply of Microsoft Windows products.
An increased technological advancement will reduce the overall cost of production hence increasing the supply of the products in the market. Another factor that will affect the supply of Microsoft Windows products is the change in taxes.
Increased taxation increases the cost factor of production hence reducing the general supply of the products. Mac OS is a user interface that windows emulated in its creation. It provides a number of software and a well built interface system. It is more secure as compared to windows, a factor that enhanced by its employment of Unix technology. Linux is another operating system applied in place of Microsoft Windows.
It is a free operating system and product useful in solving programming problems and coming up with quality software. Linux incorporates free software. It is not controlled by a single company but has reliable cores called kernel, which are distributed by various organizations. They focus on specific consumer requirements, such as business and home users.
Google Chrome OS is another operating system that is similar to Linux. Its main feature is the portable nature, which is preinstalled to net books.
The interfaces are based on Google web browser and utilize technological, online applications, such as Google Docs. This is possible even when the user is not connected online. Another advantage associated with the OS is that it is an open source.
The most compliment product for the Microsoft Windows operating system is the client server technology based on the internet. The web has totally transformed the manner in which computers are used.
The internet, for instance, has brought in the need to eradicate non-portable software on personal computers because many consumers prefer web-run software applications Satran.
Inelastic demand occurs when a change in price has a minimal impact on the demand of a product. On the other hand, the price is inelastic if the change in the price has a huge impact on the demand of the product. For instance, if individuals are used to buying a product as a result of habit, they will tend to purchase the product even if there is an increase in price.
This case applies to the Microsoft Windows product. In the event that the organization increases the price of the product, there will be a short-term inelastic demand.
This is because many people are used to the product and will opt to pay for it. However, as time goes, people will get tired of paying the high prices and eventually opt for other operating systems.
Microsoft Windows organization is a capital incentive organization due to the higher capital costs involved in its production processes.
The costs are fixed in nature. The technological factor is important within the organization as it determines the cost of production and meets consumer preference and need. The organization future should focus on expanding critical operating systems that target large organizations and other enterprises. This should consider features, such as back office servers, application products, office based systems internet incorporation, and consistent data storage unification.
The organization future is obligated to provide technology advancement, operating systems and server connection on PCs, television, and other devices. The revenue from these services may not be the same as the initial revenue and the organization must be prepared to make necessary changes and absorptions.
Jenkins, G. But they are closely related. Many managers assume they understand the full picture based on their experience pricing their products in the marketplace, that they know how consumers will respond to almost any price change, explains Avery. But rarely have companies tested extreme price changes.
More extreme changes in price may elicit significantly different consumer responses. Therefore, elasticity can often be an inexact calculation. Avery points out that in a digital context, this is easy and inexpensive to do. Understanding the why behind consumer behavior is critical to predicting how they will respond in the future. Therefore, smart marketers supplement any quantitative testing with qualitative research to get at the underlying reasons for consumer behavior.
Ultimately, you want to stay relevant to consumers and differentiated from your competitors. Once you do that, you can adjust price up or down to better represent the level of value you are providing to your customers.
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