The purpose of this milestone is for students to explore the various costs their firm faces and to describe their firm’s market. Using the concepts and tools
developed in Modules Four and Five, students will analyze the fixed and variable costs of their firm, how those costs have changed over time, and how those
changes have impacted their firm’s overall health and sustainability. In analyzing their firm’s market, students will detail the extent of their firm’s market power
and their firm’s ability to influence the market. Students will also describe major trends in the market, specifically concerning new products, technologies, and
new entrants. Students can further determine the future health of their firm to inform their final recommendations by examining their firm’s place within the
Prompt: Submit a draft of the Costs of Production (Section IV), Overall Market (Section V), and Recommendation (Section VI) of your research paper, including
all critical elements listed below. You will review your firm’s financial reports and other relevant data sources to collect and analyze cost information for your firm
over the past five or so years. Using real data and the economic tools developed in Module Four, you will analyze your firm’s profitability and how costs impact its
growth. Additionally, you will find data on your firm’s competitors in order to detail your firm’s place within the market currently and over the past five or so
years. Lastly, you will develop a recommendation for how the firm can manage its future production.
Specifically the following critical elements must be addressed:
IV. Examine the costs of production for your firm.
a) Analyze the various costs a firm faces, their trends over time, and how they have impacted your firm’s profitability.
b) Apply the concepts of variable and fixed costs to your firm for informing its output decisions. For instance, analyze how different kinds of costs
(labor, research and development, raw materials) affect the firm’s level of output.
V. Explore the overall market for your firm.
a) Discuss the market share of the firm and its top competitors by providing details on current percentages for each firm and describing the trend
over time. You might consider presenting the data graphically.
b) Analyze the barriers to entry in this market to illustrate the potential for new competition and its impact on your firm’s future in the market.
c) Describe the market structure for this firm and analyze how this affects the firm’s ability to influence the market.
a) Develop a recommendation for how the firm can manage its future production by synthesizing the data presented.
b) Suggest how the firm’s position within the market and among its competitors will allow it to take your recommended action.
c) Describe how the firm can sustain its success going forward by evaluating the findings from demand trends and price elasticity.
Guidelines for Submission: Your paper must be submitted as a three- to six-page Microsoft Word document (each section should be one to two pages) with
double spacing, 12-point Times New Roman font, one-inch margins, and sources cited in APA format.
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