Assignment:
Objective: Students will write an essay containing at least 750 words, excluding headings and bibliography. The essay must use at least two sources of information that are included in a bibliography and each cited at least once in the essay using a popular citation method, such as MLA. One of the sources must be scholarly and the remaining two can be either scholarly or popular sources.
For assistance on properly citing sources, you may find the King's library helpful: https://kings.libguides.com/citation
Topic:
Imagine that you are planning to start your own small business. An entrepreneur must use analytical skills to determine the day-to-day operation and financial outcomes of a new startup, not leaving out any details. Your task is to describe the product that your new startup will produce, describe the industry that your startup will exist in, and determine what the cost and revenue structure will look like. Be sure to describe your product in detail. Is it different from competitors' products? How so? When describing the industry, try to determine which kind of industry your startup exists in (perfect competition, monopoly, oligopoly, or monopolistic competition).
Do firms in the industry compete on price, on quality, or on differentiation (or a mixture of each)? Does your firm sell a commodity/standardized product? Will your startup be a price taker or a price maker? Are there any barriers to entry? Use these attributes to determine what is most likely to be the industry structure your startup faces. Remember that reality is not as straight forward as theory, so you will have to make a best-guess.
When you describe the cost and revenue structure:
1) define the product,
2) determine what fixed inputs are used,
3) determine what variable inputs are used,
4) estimate fixed and variable cost for at least several different levels of output that your firm is likely to encounter,
5) determine the level of revenue that would be generated at different production levels. It might be handy to make a table when describing the cost and revenue structure. Try to determine the profit level associated with the production levels. (As a side note: papers that do not include at least one excel table are unlikely to perform well).
How does the market for your new startup's product look for the long run? Can you earn profit into the long run?
Through the discussion, consider and integrate concepts of economic theory that were learned during class and show the reader that you understand how economic models work and apply them in a way that allows the reader to view the startup through them. Remember that economic models help us understand and predict economic realities, so be sure to choose an appropriate model and use it appropriately to predict the future. Assume the reader has a college-level education and can follow economic theory well but could use a "refresher".