Investment required to build production facilities prohibits

Assignment Help Business Economics

Reference no: EM131101728

You are the manager of BlackSpot Computers, which competes directly with Condensed Computers to sell high-powered computers to businesses. From the two businesses’ perspectives, the two products are indistinguishable. The large investment required to build production facilities prohibits other firms from entering this market, and existing output firms operate under the assumption that the rival will hold constant. The inverse market demand for computes is P=5,900 – Q, and both firms produce at a marginal cost of $800 per computer. Currently, BlackSpot earns revenues of $4.25 million and profits (net of investment, R&D, and other fixed costs) of $890,000. The engineering department at BlackSpot has been steadily working on developing an assembly method that would dramatically reduce the marginal cost of producing these high powered computers and has fond a process that allows it to manufacture each computer at a marginal cost of $500. How will this technological advance impact your production and pricing plans? How will it impact Blackspot’s bottom line? Comment

Reference no: EM131101728

Questions Cloud

Marketing communications tools : This assignment requires you to analyze how DELL COMPUTERS integrates its marketing communications tools and promotional activities. Your essay should display the following:

Describe the conquests of alexander the great : Describe the conquests of Alexander the Great and analyze the legacy of his empire. Be sure to mention his impact on Persia, India, and Egypt as well as the cultural implications of his conquests.

Marginal cost curve and market price for cotton : Suppose ACME operates in the cotton textile industry and like other firms, its marginal cost curve is MC= 5 + 3Q. If the market price for cotton is $8, how much cotton will ACME produce? SHOW ALL CALCULATIONS.

Could the auto store qualify as a holder in due course : Could the auto store qualify as a holder in due course?

Investment required to build production facilities prohibits : You are the manager of BlackSpot Computers, which competes directly with Condensed Computers to sell high-powered computers to businesses. From the two businesses’ perspectives, the two products are indistinguishable. The large investment required to..

Theories and models of public administration : Research theories and models of public administration. Write a 500 to 700 word paper in which you describe the history of public administration. Include a description of at least two public administration models.

Are these materials appropriate for their intended audiences : What qualities or characteristics of these materials make them effective or ineffective? Are these materials appropriate for their intended audiences? What changes, if any, would you make to these materials to make them more useful and/or effective?

How did labor change with the rise of the factory system : How did labor change with the rise of the factory system in the northern United States? What role did religion play in American life during the Market Revolution?

Absorption costing income statement : Trez Company began operations this year. During this first year, the company produced 100,000 units and sold 80,000 units. The absorption costing income statement for its first year of operations follows.

User Account

All Pages