Week Five Assignment Paper Essays - Pricing, Market Economics

Week Five Assignment Paper David A. Keith BUS 6 4 0 Managerial Accounting Instructor Zhimin Huang October 16, 2017 Week Five Assignment Paper Problem One You are a business adviser for Alba and Gavigan . Describe a skimming price and a penetration price, and advise them whether they should charge a skimming price or a penetration price, with supportive reasoning for and against each pricing alternative. Skimming price sets high levels for what prices allow higher profits of outcome for diff erent firms (Douglas, 2012 sec. 9.1). Fortunately, firms gear to prices of lesser means by which another firm enters markets and decreases prices that customers will to paying because of what other competitors base upon. One crucial factor goes beyond price skimming's allowing firms to recuperate much means of skunking cost within other market firms ( Tellis , 1986). Penetration price relates to lower prices causing additional product units being sold in achieving much penetrations within a market (Douglas, 2012, sec.9.1). Beside skimming price where objectives in profits are higher within little periods with objectives of penetration price attracting higher levels of consumers and gaining shares of market (Douglas, 2012). In addition to usage of strategies to unsuccessful means to which firms gradually begin to increase with price goes towards what actions take place within these means. I would say to use price skimming strategies that allow firms to earn higher profit levels in attempting on recovering sunken cost. Strategies of price penetrations prove to becoming detriments to long-terms firms rising prices in efforts to increasing profit margins which I have not thought of using. Are they likely to make economic profits initially? Can they continue to make economic profits in the long term? Why or why not? Discuss. Companies form of profits made through economic means consider marginal usages, and in the long run, these companies are likely to making these profits with shifting of customers usages go towards more natural products of manufacture company's like Honest Company. In remaining profitable, company's need use good and wise strategies to keep from being in the same as their competitors. What advice would you give to Alba and Gavigan to help them make more profit in the long term? For company's who make profits in longer terms profit from wider ranges by which suggestions to products of organic usage because they bring in many customers to buying these products. These brands come in higher priced forms then products that are not organic, therefore making them more expensive and price effective to which consumers are able to buy. In the long run, these products generate a large form of profits in long-term levels. The celebrity structure of Alba also profits from these means. Problem Two Show all of your calculations and processes. Describe your answers in three- to five-complete sentences. What price would you bid if you must win the project? Rival A Rival B Rival C Me Earlier Bid Patterns Increment costs goods 35 - 50% Filled costs good 8 - 12% Filled costs goods 10 - 15% Increment costs goods 60 - 80% Structured Costs 0 0 0 0 Incremental Costs 294800 268000 214400 268000 Full Costs 440000 440000 440000 440000 Approx. Bid - High 442200 492800 506000 482400 .80% Approx. Bid - Low 397980 475200 484000 428800 .60% 396640 .48% Additional features not quantifiable to project bids to which a company wish to achieve are more the lower bidders. In addition to early bid patterns, these biddings come within price range t o 482400 and 428800. In addition, incremental conditions come at 60 percent with competing A's at lower bid costs, which I think goes within 48 percent with job biddings at 396640. With 12 percent of low forms take place within earlier bid patterns considered worthy that I feel have roles of revenue being generated. What price would you bid if you want to max imize the expected value of the contribution from this contract? In my opinion to maximizing values through contributions of contracts, comes to mind biddings of 482400 increment cost and 80 percent means. These biddings come in lesser forms then rivals (B) or (C), with possibility to winning contracts with low biddings to 482400. Defend your answers with discussion, making any assumptions you feel are reasonable and/or are supported by the information provided. Though many