The objectives of the firm can be viewed as the motives of the entrepreneur/s who own and run the firm. There a number of goals that firm can pursue in its day to day operations - it may try to maximise profits‚ sales or growth‚ meeting shareholder expectations‚ or increasing market share. Maximising profits - making the biggest possible profit‚ or the smallest possible loss - is recognised as the main objective of most firms. Profit is the difference between the firm’s total revenue (output sold
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ECONOMIES OF SCALE Economies of scale are the cost advantages that a business can achieve by expanding the scale of production. That is‚ when long-run average costs (LRAC) fall. Overhead costs (fixed) are spread over more units produced. Overhead costs (fixed costs) are spread more when more units are produced. These lower costs are an improvement in productive efficiency and can benefit consumers in the form of lower prices. Units produced Total cost Average cost
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Economies of scale Puregold is perhaps one of the companies that are benefiting from economies of scale‚ and for good reason. As a dominant player in retailing‚ the company’s size provides it with enormous efficiencies that it uses to keep costs low. For example‚ its size allows Puregold to do its own purchasing more efficiently since it has roughly 250 large stores worldwide. This gives the company tremendous bargaining power with its suppliers. Not only does it get its products cheaper‚ but its
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There are benefits and drawbacks in increasing the size of operation of a business. The cost advantage is known as economies of scale. The cost disadvantage is known as disecomonies of scale. The benefits of large-scale business Economies of scale are the cost advantage from business expansion. As some firms grow in size their unit costs begin to fall because of: Purchasing economies when large businesses often receive a discount because they are buying in bulk. Marketing economies from spreading
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Project title: Spillover effects of FDI: Do domestic manufacturing firms benefit from foreign direct investment in Vietnam. Introduction Back in the 1990s‚ foreign direct investment (FDI) became the largest source of external finance for many developing countries. In Vietnam in particular‚ the Law on Foreign Investment promulgated in the 1986 Congress to attract FDI was considered the first step of the doi moi (renovation) reform. The cumulative FDI increased from 28 projects of total US$ 140 million
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barriers to entry which help an existing leading firm earn positive economic profits in imperfectly competitive market structures. These barriers are: the financial burden of non-price competition‚ legal barriers‚ economies of scale‚ and the large expenditure for capital to enter certain industries. A firm that wishes to enter into an imperfectly competitive market must bear the cost of differentiating its product or service from that of the existing firms. This includes switching costs for technological
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production associated with Delta‚ economies of scale are also relevant to this firm. Economies of scale operate to the left of Q* or the minimum efficient scale of operations according to class lecture notes. So it is in firms best interest to expand and operate at a more efficient level. Delta is a Legacy Airline; because Delta is one of the larger airlines Delta’s costs are expensive in terms of operation. According to lecture notes from class‚ economies of scale are characterized by the specialization
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INTRODUCTION TO FRANCHISE MANAGEMENT DEFINITION : *In simple terms‚ a “franchise” is an agreement between two parties which allows one party i.e. the franchisee‚ to market product or services using the trademark and operating methods of the other party i.e. the franchisor. (bfa) *“A franchise operation is a contractual relationship between the franchisor and franchisee in which the franchisor offers or is obliged to maintain a continuing interest in the business of the franchisee in such areas
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Dissertation Committee for Victoria Konstantinova Vernon certifies that this is the approved version of the following dissertation: Household Economies of Scale‚ Food Consumption and Intra-Household Allocation of Time Committee: Li Gan‚ Supervisor Daniel Hamermesh Richard Dusansky Douglas Dacy Hong Yan Household Economies of Scale‚ Food Consumption and Intra-Household Allocation of Time by Victoria Konstantinova Vernon‚ dipl.; M.A. Dissertation Presented to the Faculty
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Katholieke Universiteit Leuven Department of Business Studies Korte Nieuwstraat 33 B-2000 Antwerpen‚ Belgium Email: Martine.Cools@lessius.eu Phone: +32/3/201.18.75 - Fax: +32/3/201.18.42 Research interests: management accounting and control in intra-firm and interfirm relationships Alexandra Van den Abbeele Assistant Professor of Accounting Katholieke Universiteit Leuven Naamsestraat 69 3000 Leuven - Belgium E-mail: alexandra.vandenabbeele@econ.kuleuven.be Phone: +32 16 32 69 36 - Fax: +32
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