StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

Economics Theory Applications - Research Paper Example

Comments (0) Cite this document
Summary
Name Professor Course Date Economics Theory Applications It is worth noting that just like economies that have developed time so are the economic theories. Even though the word “economy” may be old, modern economic thought dates back in time to the 1600s and 1700s when the world economies began their transformations from the agrarian to industrial societies (Samuelson, 1986, 2)…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER98.6% of users find it useful
Economics Theory Applications
Read TextPreview

Extract of sample "Economics Theory Applications"

Download file to see previous pages According to Mandal (2007, 97) this problem can only be determined based on price mechanisms that has been known to use forces of supply and demand that characterize different products. This is because price mechanism is used to refer to the mechanism that uses prices of products as a signal to both the buyers as well as sellers in any market as to what the market has in store for them, and what trend to follow. This is what forms the core of microeconomic theory where demand, supply and quality prices have a significant role to play. This paper explores the Malaysian market by focusing on Astro satellite TV monopoly to determine the problems that Malaysian satellite television’s market is facing and attempt to solve the problem using microeconomics theory. Microeconomics theory This theory stipulates that demand is the willingness and the ability for a consumer to buy a particular product within a specified period of time. Therefore, if all other factors are held constant, it follows that as prices of goods increases the demand decreases proportionately (Tsoulfidis, 2009, 30). This means that demand and price are inversely proportional. A lower demand of goods means a reduced amount of quantity purchased by consumers. The amount of goods consumers buy at higher prices decrease because as the prices go up, so is the opportunity cost of buying that good or service. People will therefore tend to buy inexpensive goods or services, and avoid buying that product that will force them to forego certain goods or services that are of more value to the consumer. This theory is applied mainly in a monopolistic market where it is only one supplier of goods and services with many consumers that exist, eliminating the case of competition (Ghai and Gupta, 2002, 2). What is Monopoly? Monopoly is a situation characterized by the existence of a single producer in a market who is in control and not with any close competition whatsoever of supplying a particular product. This means that the elasticity of demand tends to reduce to almost zero. A company enjoying monopoly has some benefits such as the ability to be innovative with the development of its product and the domination of the demands of the customers (Kirzner, 1997, 65). This is, in addition to, setting its own price standards, orderliness and predictability. The constraints that happen to be either legal or natural protecting the monopoly of the firm from its competitor often generate the blockade to entry to the monopoly market. To make the best use of the profit, monopolist should generate at an output that the marginal cost is equal to marginal revenue. However, the biggest problem of monopoly market is that monopolist is a price maker rather than those price takers in a competitive market (Dwivedi, 2002, 38). This is because the monopoly firm will only continue enjoying maximum profits so long as entry of other firms into the market is blocked. This may either be naturally or artificially. Therefore, the firm will continue to produce, and even function at a loss on condition that the losses the firm makes do not in any way exceed its fixed costs (Ghai and Gupta, 2002, 3). This means that the firm will only close when the losses are in excess of the fixed costs of the company. With this advantage, monopoly will charge at the price which is in excess of the marginal price and marginal income, for whatever ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Economics Theory Applications Research Paper Example | Topics and Well Written Essays - 2000 words”, n.d.)
Retrieved from https://studentshare.org/macro-microeconomics/1449317-monopoly-case-study-astro-satelite-tv
(Economics Theory Applications Research Paper Example | Topics and Well Written Essays - 2000 Words)
https://studentshare.org/macro-microeconomics/1449317-monopoly-case-study-astro-satelite-tv.
“Economics Theory Applications Research Paper Example | Topics and Well Written Essays - 2000 Words”, n.d. https://studentshare.org/macro-microeconomics/1449317-monopoly-case-study-astro-satelite-tv.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Economics Theory Applications

Bandura's Philosophy Theory

His memories are an accumulation of yesterdays. In yesterday's are written his dealings to others and to himself. He finds life more meaningful in the lives of others. His reason for living is to serve others because he learns more of himself by dealing, relating with and loving others. Hence his motto in life is: “Do to others what he wants others to do to him.”

Bandura’s theory confirms the reality of the experience. A man needs mirroring of others to tell him whether what he is doing is fine or not. The wife is the best critic of the husband and vice versa. This is what makes marriage a wonderful ground for discovery for the two is made into one yet uniqueness of each is still there.

Band...
7 Pages(1750 words)Coursework

International Business Economics

According to Adam Smith, the absolute advantage would be realised as long as the cost of production differed from between countries, one or both countries would gain by trading. An example to illustrate this is a situation where we have two countries A and B which produce two similar goods X and Y. The figures show labour cost in hours for producing one unit of a good

David Ricardo formulated the theory of comparative advantage and argued that even if one country is more productive in both lines of production it would be still profitable to trade. Country A is more productive in both lines of production but it will still be profitable to trade with country B, this is shown by first stating that country A is more advanta...
6 Pages(1500 words)Assignment

Securitisation and the International Relations Theory

The other aspects under investigation in this paper are the importance of the notion of security to the theory of international relations and its application to the facilitation of the process of international communication.

There exist several theories of security, which will be regarded in this paper. Among them is traditional security theory, which is regarded as the realist construct of security under which the object of security is the state and was applied during the period of the Cold War. Later this type of security evolved into human security, which is concerned more with the security of the single individual rather than the security of the state. I will present several theories of securitization and see how th...
14 Pages(3500 words)Assignment

Economic Theory: Reducing Pollution and Global Warming

Many of the economies based on capitalism may not favor the workings of free trade as they are developing towards self-sufficiency. Furthermore, these capitalistic economies may not even support fair trade, as it may seem that all the poorer countries may destroy or exhaust all of their natural resources to get rich in a very short period of time. Poorer countries would then eventually be more responsible for a shortage in the supply of these scarce resources and more importantly- will be adding huge problems in controlling environmental issues such as global warming and pollution (Hackett, 2001). However, these thoughts may also be disagreed, as, in recent years, there has been a tremendous effort and attempts to fuse the environ...
6 Pages(1500 words)Term Paper

International Trade Theory

 Further to this, it is also believed that international trade can bring substantial economic welfare to the countries however still most of the countries do not view it as a favorable thing. Despite having a very promising and bright outlook, international trade has been largely viewed with suspension and it is because of this that governments impose barriers to restrict international trade. There can be many reasons behind this act of imposing restrictions or blocking international trade however there are also benefits on the other side too.

International trade has driven the attention of many of the brilliant minds in economics therefore the origins of the economic theory on international trade owe much to the c...
6 Pages(1500 words)Case Study

Economics or Ethics

Several CEOs in America have in coalition with top managers deviated from the norms of corporate governance and caused immeasurable woes to the stakeholders. Using their power and ego they chased the wealth for personal gains without any concern for the shareholders or other stakeholders of the company. Enron, the world’s largest energy trader at one time, had to file bankruptcy under Chapter 11 when about 5000 workers lost their job (Bhattacharya, 2004). Arthur Anderson, one of the big five auditing firms was charged to have colluded with the management to misappropriate funds and project a picture different from the reality. Income was inflated and then all concerned papers were destroyed. The leadership at Enron was conce...
6 Pages(1500 words)Assignment

Social Theory in a Globalizing Age

A comparison between the followers of social theories and the followers of natural sciences (physics and chemistry) revealed that unlike followers of natural sciences social theorists don’t use any techniques to show the exact knowledge or skill. Instead, they prove their work or idea by suggesting a possible way of explaining the facts or arguments usually called hypotheses (Lemert, 2004).
By hypotheses, social theorists cannot easily prove their argument at a time but they require time to prove it. Social theorists are normally criticized for using the hypotheses. Deconstructionists or postmodernists, rigidly critical theorists, disagree with the criticism by mentioning that any research methodology is not 100% pure a...
10 Pages(2500 words)Assignment

Managerial Economics and Business Environment

Once the above said subject matter is clearly sorted out, the next emphasis would be on the concepts like the opportunity costing, incremental principle, marginal principle, discounting principle, the principle of time perspective, and calculation of economic profit as the guidelines to the scope of managerial economics. (Surender. V, 2008).
To start with, we consider a firm for which different processes have to be carried to achieve its objectives of profit maximization (assuming that all the organizations work with the view to maximize profits). If firms from different sectors are identified simultaneously, then the working of the economy as a whole could also be analyzed which in turn is useful in the decision-making proce...
15 Pages(3750 words)Assignment

Free Cash Flows Theory

These are not hard and fast rules in determining the capital structure which should best affect a firms value. These theories lay down the benefits and the costs when a firm chooses what it sees as an adequate mix to maximise the shareholders value.

One of the implications where this research can lead include the possibility of the effectiveness in maximising shareholder value by employing two or more theories in capital structure decisions. Because these theories are more conditional by nature, probing which combinations when used for capital structure decisions are more effective in arriving at the goal of maximising firm value can be another subject for further research.
The role of capital structure in increasi...
11 Pages(2750 words)Case Study

Management Theory and Practice in the Early Childhood Education Industry

As pointed out in a study by Osgood and Halsall (2007) where they carried out research to examine the position of women in leadership or management positions, a “glass ceiling” exists for women in the academic setting, which could significantly impair motivation. Since many of the individuals employed in the early education sector are women, addressing this issue is even more important because these individuals are faced with the difficult task of shaping young minds while also dealing with the problems associated with the actual physical care of very young children. The quality of professionals in this sector is vital because it impacts the growth and development of the children that they care for. The degree of invol...
6 Pages(1500 words)Coursework
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.

Let us find you another Research Paper on topic Economics Theory Applications for FREE!

Contact Us