Explain any relevant contextual factor that may influence it
Microeconomics
Economics Project
Overview: The final project for this course asks you to select and analyze a
case study that presents an economic problem facing a company that operates
within a particular market structure.
You may encounter additional companies\case studies within your ECO 500 Case
Study CoursePack. However, please disregard them and ONLY focus on the
following:
– American Airlines
– Heinz
– Microsoft
The American Airlines case addresses how a company manages revenue, the
Microsoft case looks at how a company maintains market power, and the Heinz
case exemplifies how a company deals with competition. All three cases involve
a company’s executives and managers looking for ways to increase profits. The
parent companies of Heinz and Beech-Nut entered into a merger agreement, which
was blocked by the Federal Trade Commission. American Airlines attempted to
navigate the mind-numbing pricing structure that created the risk of being
considered predatory. Microsoft’s anticompetitive actions in the browser
market resulted in legal problems.
For the final project, you will select one of these case studies and counsel
the CEO on an alternate strategy. Imagine that the CEO has tasked you, the
corporate economist, with researching the issue and reporting on a possible
plan of action. To begin this process, you must clearly understand the problem
at hand and be able to identify the root cause. Selecting the appropriate
economic model to drive your analysis will be important in guiding your
research.
Journals are private between the student and the instructor. Review this
tutorial for information on creating a Blackboard journal entry.
Prompt: Compose a preliminary problem statement in which you identify the
company you have selected to research and describe the problem at hand. In
this statement, you should:
– Identify and articulate the problem as presented in the case study,
describing any relevant contextual factors that may influence it.
– Use your background knowledge in economics and your critical thinking
skills to deduce possible root cause(s) of the problem
– Identify the appropriate economic model(s) that should drive the analysis
of this problem. Is this a demand-side problem? Or is it a supply-side
problem?
In business scenarios such as this one, problem statements are needed to
describe the problem in a concise way. These statements provide a clear and
focused analysis of objectives and offer a method that will be followed to
find possible solutions.
You may find it useful to gather information about the organization or
company’s current initiatives and processes, general policies, and stated
goals. Information can generally be found in the organization’s main website,
annual report and mission statement, and articles authored by the company or
by outside analysts. Additionally, you might consider accessing relevant
company and market information on the following sites:
– U.S. Bureau of Labor Statistics
This is a good source for costs information (i.e., producer price index
[PPI]), labor market conditions (i.e., employment and unemployment by
industry), and prices of various goods (i.e., consumer price index [CPI]).
– Electronic Data Gathering, Analysis, and Retrieval (EDGAR)
