New Good or Service Business Proposal
Select a new good or service for an existing business or a business that you want to develop.
Write a 1,050- to 1,400-word business proposal for your chosen good or service. Include assumptions about the elasticity of demand and the market structure for the good or service. You might need to create hypothetical data or collect real data to determine fixed and variable costs. THIS IS AN ECONOMICS course; the entire focus of your proposal must be economic. If its marketing focused like most business proposals you will be disappointed in your grade.
Answer, number and include rationale for the following questions. Make sure to use section headings for each answer:
- How will you increase revenue? As this is an economics course, talk specifically about whether to RAISE price or LOWER price based on your assessment of its elasticity of demand. DON'T discuss increased advertising, coupons, or loyalty programs, etc.
- How will you determine the profit-maximizing quantity? Hint: think law of diminishing returns and economies of scale
- How could you use the concepts of marginal cost and marginal revenue to maximize profit? What information do you need to determine this? Without this information, how would you make a decision?
- What is your suggested mix of pricing and non-pricing strategies? What specifically do you suggest in terms of pric and non-price tactics? Explain your answer.
- Can you create or increase barriers to entry? If so, how?
- How will you increase product differentiation?
- Are there other ways to minimize costs for the product?