Economics 561: Case Study
Business Proposal
Aracheal Ventress
Economics 561
April 7, 2014
Maria Hamideh Ramjerdi
Business Proposal
The digital world has created a market for producing products that are user-friendly, serves multi-purposes, has 24 hour accessibility, and lightweight to carry. Society is plugged in and a common desire is to have applications available at the click of a mouse. Because of this sense of urgency, Will Bury believes that, in the near future, most of the population will be reading or listening to everything digitally, including books that have been mostly available in hard copy. He has developed and patented technology that scans books into a digitizer. "This technology takes the printed word for text materials and creates a file with the option of reading it digitally or listening to it with a realistic synthetic voice" (Will Bury’s Price Elasticity Scenario, pg.1, 2014). …show more content…
Depreciation costs- these costs will be associated with the wear and tear of the machines used in production. More machines will increase more depreciation costs.
Anticipated Variable Costs:
a. Labor- to increase output, labor force for this product must occur. Due to the simplicity of the production process, Will can hire non skilled labor at hourly rate that is favorable to his budget. Labor is a variable cost because it will fluctuate with the rate of production. To free him of some time, he can hire one person for a couple of days a week and then gradually hire more as the revenue increases.
b. Marketing strategies- the survival of Will 's product is effective advertising. He will need money to make consumers aware of the product innovation about the others in the market.
Conclusion Will has designed a proprietary technology that will change the way people access books and other articles currently offered in print. If he chooses to use the economic principles outlined in the paper, he will have a better chance of succeeding in a monopolistic competitive
Aracheal Ventress
Economics 561
April 7, 2014
Maria Hamideh Ramjerdi
Business Proposal
The digital world has created a market for producing products that are user-friendly, serves multi-purposes, has 24 hour accessibility, and lightweight to carry. Society is plugged in and a common desire is to have applications available at the click of a mouse. Because of this sense of urgency, Will Bury believes that, in the near future, most of the population will be reading or listening to everything digitally, including books that have been mostly available in hard copy. He has developed and patented technology that scans books into a digitizer. "This technology takes the printed word for text materials and creates a file with the option of reading it digitally or listening to it with a realistic synthetic voice" (Will Bury’s Price Elasticity Scenario, pg.1, 2014). …show more content…
Depreciation costs- these costs will be associated with the wear and tear of the machines used in production. More machines will increase more depreciation costs.
Anticipated Variable Costs:
a. Labor- to increase output, labor force for this product must occur. Due to the simplicity of the production process, Will can hire non skilled labor at hourly rate that is favorable to his budget. Labor is a variable cost because it will fluctuate with the rate of production. To free him of some time, he can hire one person for a couple of days a week and then gradually hire more as the revenue increases.
b. Marketing strategies- the survival of Will 's product is effective advertising. He will need money to make consumers aware of the product innovation about the others in the market.
Conclusion Will has designed a proprietary technology that will change the way people access books and other articles currently offered in print. If he chooses to use the economic principles outlined in the paper, he will have a better chance of succeeding in a monopolistic competitive