Simulation Strategies Paper

Simulation Strategies Quasar Computers has developed an all-optical notebook computer called Neutron that is five times as fast as existing microchip-based computers. They have asked the author to make operational and business strategy decisions in response to market conditions. The author has been asked to create a solution to these conditions using strategic variables available to sustain the economic profits the firm can earn, recommend pricing and non-pricing strategies, and what kind of innovations would sustain the organization’s uniqueness.
The first monopolistic scenario, Quasar will need to maximize their profits in a monopoly. Profit maximization will occur when marginal revenue equals marginal cost (McConnell, Bruce, Flynn, 2009). Quasar will be able to achieve this if their selling price is 2,550 and quantity is 5.3 million units. This would generate a total profit of 1.29 billion. The second monopolistic scenario, Quasar has a choice to increase their advertising budget or retain the previous year’s budget of 400 million. Increasing the advertising budget to 600 million would be the best choice to generate the most revenue. This would be a non-price strategy that would make Quasar’s products more attractive. The selling price would reduce to 2,450 with an increase of quantity to 7.7 million units; ultimately, increasing
They have two choices; invest in Neutron because it is the flag ship of Quasar, or invest in Ceres, their new model. Investing in Neutron will reach a combined profit of 1143 million, while investing in Ceres will lead to a combined profit of 1305 million. It will be more profitable to spend money on the launch of a new brand than on an existing brand because the demand for that brand has already peaked. Quasar will also be able to increase market share due to competition for the new