group+2


 * ~  ||~ Student's Posts ||~ Teacher's Comments ||
 * Project A ||

** Economics Project A  ** Apple released the first iPad in April 30 2010, and sold 3 million of the devices in 80 days. Its price determination comprises of several key factors from both the producers (Apple) and the consumers (the general public).From the producers side, consideration must be taken firstly for breaking even, which is earning enough to meet the cost of production as if they do not do so they would be incurring losses from not meeting it. Then, the target profit would then define the price as the producers are profit driven, they will therefore make decisions that will make a profit. However, if they set too high a price, consumers would be less willing and able to purchase the iPad. Thus, the consumers would limit the price by their willingness and ability to purchase the iPad. This will determine the demand. Then, producers would evaluate the demand of the consumers and supply the quantity of products they are willing and able to sell. This determines the supply. Essentially, this would ensure the price is set rationally as the interaction of demand and supply that determines the price of the iPad, which is the equilibrium price. iPad associated or related products, such as iPad covers, speakers, iCade (an external gaming device), specific customisations, etc will add to the highest-added value of the iPad resulting in an increased cost of the iPad, whether directly or indirectly. For instance, extra gadgets for the iPad sold in packages would increase its price. An example of iPad exclusive application (app) is an app called Aweditorium which became the top 4 apps for the iPad. This kind of complementary products would be appealing to the taste of the consumer, thereby increasing the demand for iPads. Also, the Samsung Galaxy Tab which is a substitute for the iPad is relatively more expensive than the iPad. The consumers would therefore choose the more appealing and cheaper iPad, thus increasing its demand. All this would inevitably increase the price of the iPad || Can you copy and paste both the reports (project A and B) on the boxes to the left and remove the attachments so that I will be able to comment right beside your findings for the report. Since we have our lesson tomorrow, i will just write some comments so that you can address them while giving the presentation tomorrow. You can even make some amendments or include these to your presentation if needed.
 * Explain what breaking even means and why is it important.
 * You have explained why producers cant charge a very low price. You also need to address what happens if producer charges an extremely high price.
 * You address demand and supply side individually. How do you link them for determination of price?
 * How are goods like accessories, customisations and applications related to ipad? How do they impact ipads? ||
 * Project B || Project B

What is Price?

Price is a component of an exchange or transaction that takes place between two parties and refers to what must be give up by one party (i.e., buyer) in order to obtain something offered by another party (i.e., seller).

What is marketing?

Marketing- the total of activities involved in the transfer of goods from the producer or seller to the consumer or buyer, including advertising, shipping, storing, and selling.

Producer

1) Productivity

The efficiency of producing the iPad within a certain time (e.g., how much can be produced within a certain period of time), especially with today’s advanced technology, will allow producers to judge the cost of producing each unit of iPad. With an increase in productivity, the producer will know that cost of producing a unit will decrease and thus he will lower the price and vice-versa.

2) Meeting Consumer Expectations

With the same product being sold at different producers, customers will definitely compare the overall worth of the product more than its price. As more substitutes come in, the price of competitors will be tighter and tighter and since there is a fixed price for the sale of iPads it will depend on the amount of gifts or complimentary products that follow the purchase of an iPad. Thus, producers need to research on the overall market prices and keep the price of the good at satisfactory standard but also taking into consideration of what the consumers require or demand. If the prices are too high or that they do not provide enough complimentary goods, the consumers may be discourage to buy the product and hence choose to purchase from competitors or choose to purchase substitutes. As producers are profit driven they will do their best to meet the needs of the consumers. Consumers are also driven by the best deal they could receive for the same amount of money thus they want to buy the product that is most value for money. || Can you relate the points you have come up with, to recent developments in the market. Probably you can talk about changes in consumer expectations in recent times and how it impacts pricing decisions. The points raised by you all from the consumers point of view are well addressed. || I would like to suggest that you can use diagrams to support your explanations wherever possible. The 1st four slides are a bit too vague. You all might consider revising it. You missed out the point on consumer expectation which is one of your findings for project B. So please include it in the slides. You havent yet addressed taste as a demand side factor in your slides. Hope you all incorporate my comments for your presentation tomorrow. All the best. Will see you all tomorrow.
 * Presentation Materials || [[file:shreya ppt.pptx]] || I want to thank you all first for the effort you guys put in for this project and more so because you all had to do it during holidays.


 * P.S. Your group will be the 1st group to present tomorrow followed by Group 1.** ||