1) Provide an overall description of the business and the competitive environment in which it operates. You should describe:
a) what type of business it is (e.g. retail, manufacturing);
b) what the business produces or sells;
c) who the main customers are (e.g. other businesses, government departments, young girls, older men);
d) where most of the customers are located (e.g. in Townsville, Jakarta, or on the net);
e) who the main competitors are (i.e. those producing similar products, and selling to similar customer base);
f) Where the competitors are located; and
g) The (approximate) market share of key competitors including your business (e.g. 'your' businesses has approximately 10% of the market, your main competitor has approximately 50% of the market, and may other small businesses share the remaining 40% of the market);
Given the above information, comment on whether or not you think the competitive environment in which the firm operates is likely to be closer to
(a) perfect competition; or
(b) monopoly.
Comment also on the number of 'close substitutes' for your business' products, and the cost of your product relative to 'average' income of your customers. Does this mean that the demand curve facing the firm is likely to be relatively elastic or relatively inelastic? What does this imply about the ability of the firm to 'mark up' its price above marginal cost?