Assume that the low-calorie frozen, microwavable food company from Assignments 1 and 2 wants to expand and has to make some long-term capital budgeting decisions. The company is currently facing increases in the costs of major ingredients.
Use the Internet and university databases to research government policies and regulation.
Write a six to eight (6-8) page paper in which you:
1. Outline a plan that managers in the low-calorie, frozen microwaveable food company could follow in anticipation of raising prices when selecting pricing strategies for making their products response to a change in price less elastic. Provide a rationale for your response.
2. Examine the major effects that government policies have on production and employment. Predict the potential effects that government policies could have on your company.
3. Determine whether or not government regulation to ensure fairness in the low-calorie, frozen microwavable food industry is needed. Cite the major reasons for government involvement in a market economy. Provide two (2) examples of government involvement in a similar market economy to support your response.
4. Examine the major complexities that would arise under expansion via capital projects. Propose key actions that the company could take in order to prevent or address these complexities.
5. Suggest the substantive manner in which the company could create a convergence between the interests of stockholders and managers. Indicate the most likely impact to profitability of such a convergence. Provide two (2) examples of instances that support your response.
6. Use at least five (6) quality academic resources in this assignment. Note: Wikipedia does not qualify as an academic resource.
Your assignment must follow these formatting requirements:
• Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
• Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.
The specific course learning outcomes associated with this assignment are:
• Propose how differences in demand and elasticity lead managers to develop various pricing strategies.
• Analyze the economic impact of contracting, governance and organizational form within organizations.
• Use technology and information resources to research issues in managerial economics and globalization.
• Write clearly and concisely about managerial economics and globalization using proper writing mechanics.
Comments for assignment 3
This assignment is very broad, it covers several of the areas we have learned in this course.
Please make sure that your paper has the following points:
· The relationship between demand and price, how elasticity measures this relationship (elastic, inelastic, etc), and for different elastic demand, what the impact on output and revenues are when the price is raised.
Your opinion about the low-calorie, frozen microwavable food market, for example, do you think the demand is elastic or inelastic, why, and based on your opinion, and the analysis on elasticity, what is your suggestion for the pricing strategy
You may want to use the information from assignment 1 and 2 here.
· Government regulations on the food market and market economy
You will want to talk about health problems, more importantly, you will want to talk about government regulations on competition.
So, you will want to discuss about the market structure of this industry (perfect competition, monopolistic competition, oligopoly, monopoly), and the companies in this industry, how competitive they are, and the directions, and the concerns of the government for this industry
You will need to use 2 concrete examples in other industries with similar market structure, and talk about how the government was involved, what the results are. .
Based on this analysis, what the impact of the regulations have on the company, its output, pricing, competition, product lines, etc.
· Pros and cons of expansions through capital investment.
This should include both financial, managerial and technology: complexities of capital expansion, including financing, estimating the cost of capital, forecasting the cashflow, maintain technology, continuity est.
Then you will need to talk about other expansion choices: mergers and acquisitions, pros and cons of mergers and acquisitions
The pros and cons of the different types of mergers and acquisitions, which is better for this company, how you compare this choice with the capital expansion.
· Organizational form and principal-agent problem
General discussions about the principal agent problem, especially for big publically owned corporation (since it asked you about shareholder problem, so you have to assume this is a public company with shareholders)
How do you think this company should be organized in terms of company structure, and why you think this structure will help in profitability?
Please make sure you have 2 concrete examples as well as general theoretical discussions
Format:
· Use at least five (6) quality academic resources in this assignment.
Note: Wikipedia does not qualify as an academic resource.
- Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format
It is good to have indentions when starting a new paragraph
- Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.
