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

Economic - Essay Example

Comments (0) Cite this document
Summary
Since November 1994, Eurostar has been providing short-haul travel services in Europe, transforming the way of traveling and making it possible for a large proportion of population to avail their service. It has established connecting services and has links with over hundred destinations in different parts of Europe…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER92.6% of users find it useful
Economic
Read TextPreview

Extract of sample "Economic"

Download file to see previous pages (Travel classes, 2009)
It is important to understand the concepts of one-price policy and variable-price policy. One-price policy is when the same price is fixed for the product by the seller, irrespective of who the consumer is. Variable-price policy is one whereby, seller sells the same product at varying prices to different customers. Large-scale manufacturers and big retailer usually follow one-price policy. On the other hand, small-scale manufacturers and small retailers follow variable-price policy. Variable-price policy is said to be prejudicial about the credibility and prestige of the customers. (R. D. Agarwal, p. 410, 1983)
The concept of contribution pricing is relevant here. Contribution pricing is the setting of prices based on the principle that as long as an item is sold for more than the variable cost, it is making a contribution towards the overheads of the business. This notion may lead a firm towards one of two approaches to pricing; price discrimination and loss leaders. In case of Eurostar, price discrimination is relevant.
Price discrimination occurs when different prices are charged to different people for what is essentially the same product. This is done in order to maximize revenue by charging more to those that can afford, and are willing to pay more. Price discrimination is a response to the recognition that different types of people may have different price elasticities of demand for a product. For instance, people under 16 years of age get high-price entrance to cinemas and football grounds in many parts of the world. This is because the owners know that higher prices will cut their demand substantially. In this case, as in all considerations of price discrimination, it is essential that there should be the minimum of crossover between market segments. In other words, if many adults could get in for half-price, the point of the discrimination would be lost.
It is important to remember that price discrimination is when a firm sells the 'same product or service' at varying process to different customers. This also applies to off-peak and on-peak telephone calls or train fares. Perfect price discrimination occurs when all the consumers are charged a different price, whereby the entire consumer surplus has been taken over by the business.
For an understanding of the concept of consumer surplus, it is important to understand that a consumer good will be valued more highly by some consumers than by others. Yet they all pay the same price for it when uniform pricing policy is being applied. Some consumers would be willing to pay a price higher than the actual market price. The term consumer surplus refers to the value of the extra satisfaction which these customers get from the item, over and above what they have had to pay for it. The consumer surplus is shown on a supply and demand diagram by the triangle enclosed by the demand curve and the price line. The demand curve shows how consumers value the product and all those who are prepared to pay at a higher price get some extra satisfaction.
Source: Tutor2u
For price discriminatory pricing, it is important that there be barriers for prevention of ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Economic Essay Example | Topics and Well Written Essays - 1500 words - 4”, n.d.)
Retrieved from https://studentshare.org/miscellaneous/1500076-economic
(Economic Essay Example | Topics and Well Written Essays - 1500 Words - 4)
https://studentshare.org/miscellaneous/1500076-economic.
“Economic Essay Example | Topics and Well Written Essays - 1500 Words - 4”, n.d. https://studentshare.org/miscellaneous/1500076-economic.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document

CHECK THESE SAMPLES OF Economic

Economic Sanctions on North Korea

As one goes on with the research work, one can be acquainted with the role of various other independent states towards development of North Korea’s nuclear program and how the international community has reacted to the nuclear ambitions of the DPRK with levying of sanctions & embargos.

I have tried to make sure that each and every point is elaborated to the reader of this research paper in a manner that the reader can link one incidence with another and every aspect discussed in this assignment can be well understood keeping in mind the historical events narrated with reference to recognized sources.

The research work starts with the introduction of North Korea and its location. The Korean war has b...
12 Pages(3000 words)Case Study

The Economic Impact of the Emergence of China and India

... and materials that are part of Toyota’s operations—the supply side of the automobile industry. The effects of this inflation do not stop in the supply side of the automobile industry which could significantly impact a firm’s cost structure. With the rising fuel prices, demand for automobiles is threatened too, as fuel is a complementary product of automobiles. At least in order to address the threat in the demand, Toyota put on the initiative to create a hybrid car which has saved its operations from this. The other economic impact of the emergence of China and India is its low-cost labor strategy that makes outsourcing to these countries attractive to automobile manufacturers. This can give a company the cost advantage it needs...
10 Pages(2500 words)Assignment

Economic Value Added as Tool for Improving Performances

To discover whether pure profits exist, take the revenue of the firm and deduct the costs of all factors of production other than capital. Then deduct the pure return on capital and any risk premium necessary to compensate the owners of capital for risks associated with its use. Anything that remains is pure profits.” Simply in economic terminology economic value added (EVA) is commercial profits reduced by opportunity costs (that is the pure return on riskless investment and the risk premium). Lipsey calls the EVA defined in this fashion as “pure profits, economic profits or, where there is no room for ambiguity, just profits”.

Investors in any company are interested in real profits that are profits r...
7 Pages(1750 words)Report

Gross Domestic Product and the Nations Competency in Terms of Economic Welfare

It is often used to compare the economic performance to aid as a prediction tool and to analyze the business cycles and the recessive and expansive economic performances within them. This further aid economic and fiscal policy formulation of the government and is also used to analyze the consumer behavior and the economic phenomena involved. (Heakal, R. 2008).These figures can be a benchmark to compare economies of different nations and the economic prediction process is also made possible.

A usual pattern of assessing the Gross Domestic Product is to have an initial GDP report on every quarter which is an advance report. Two corrective reports follow this before the final figures on GDP are arrived at. It usually takes...
7 Pages(1750 words)Report

A democratic political system is an essential condition for sustained economic progress. Discuss

What is now clear is that democracy is superior when it comes to countries that have a heterogeneous mix of people and cultures since it is imperative that all sections of society be carried along if the process of economic development has to succeed. In case this does not happen, the concerned country faces the risk of social unrest and the inability of the government to carry all the citizens along with the process of economic development.

If we look at some of the competing ideologies of the 20th century. Communism was the dominant ideology of many countries of the eastern bloc. The basic tenet of communism is the absence of private profit and state ownership of the factors of production. This means that all workers...
11 Pages(2750 words)Term Paper

Emergency Economic Stabilization Act of 2008 and How It Has Impacted the Financial Markets

Though there were objections from various quarters about the huge amounts of tax payer’s money being used in the bailout of huge corporates, the Act has been successful in moving the downturn towards a flat point and now has started slowly moving towards a recovery stage. The various programs under the EESA 2008 have played a significant role in the financial sector, housing mortgage, and banking institutions to save the institutions from complete disaster.

The Emergency Economic Stabilization Act is a huge taxpayer bailout designed to rescue the financial sector. The amount of money to be used is around $700 billion or $2000 per American citizen (Public mark up). Emergency Economic Stabilization Act of 2008 is al...
10 Pages(2500 words)Research Paper

Economic Analysis of India

The country’s economy is fast growing with a stable political system that encourages foreign investment although with certain restrictions. The country generally has good energy, transport and communication systems which make the cost of doing business affordably.

The Republic of India found South of Asia is by far the world’s most populous democracy and ranks seventh largest in terms of geographical area (Brown, 1994). India is also the second most highly populated country in the world. The country has a rich culture with four major religions having originally emerged from it; Sikhism, Buddhism, Hinduism, and Jainism. The Indian Republic consists of seven union territories and 28 states and ranks twelfth la...
8 Pages(2000 words)Case Study

Bernard Madoff : A Scapegoat of the Economic Crisis

Darwin was condemned and treated with contempt by the Church for proposing the theory of evolution that linked all living matter in the earth, including humans. In the case of Bertrand Russell, he was imprisoned as a conscientious objector, for expressing his opposition to British participation in the First World War. These are typical examples of people being wrongfully punished when they were guilty of no crime or fraud or misdoing. It would be highly improper to associate Bernard Madoff with the aforementioned luminaries, for he was truly guilty of carrying out the biggest financial fraud in modern history. At the same time, it would be simplistic to classify him as a victim of the contemporary judicial system. The truth, in fa...
6 Pages(1500 words)Assignment

International Business: World Economic Forum and Davos 2010

...in the political field in the developing countries. WEF and Davos 2010 Thus technology has pervaded every aspect of life and poses challenges along with the benefits. International organizations such as WEF have been attempting to address such issues and provide solutions. The World Economic Forum (WEF) is an independent international non-profit organization incorporated in 1971. Its sole purpose is to bring together the world’s intellectuals, journalists, and political and business leaders under one roof every year to discuss issues that could improve the state of the people across the globe. The issues include health and environment apart from business and technology. The Form also encourages research initiatives...
7 Pages(1750 words)Coursework

Globalization and World Economic Forum at Davos 2010

..., political scientists, business school academics and consultants that private sector drives globalization (Julius). Globalization involves substantial interaction among different stakeholders in economic, political, and cultural spheres. When the structures of globalization meet local conditions myriad combinations are formed. The tensions exist between state institutions and forces of globalization due to deterritorialization which limits the power of state institutions. The tensions also exist between social movements or advocacy groups with the forces of globalization. There is an increasing rapport among these social movements and advocacy groups across the borders. Civil society is at the epicenter of tension...
7 Pages(1750 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 Essay on topic Economic for FREE!

Contact Us