Microeconomic Analysis of a Company: A Guide for Consultants

Task:

Begin your paper with the introduction. The active voice, rather than passive voice, should  be used in your writing. This template is formatted according to APA Style guidelines, with one inch top, bottom,  left, and right margins; Times New Roman font in 12 point; double-spaced; aligned flush left;  and paragraphs indented 5-7 spaces. The page number appears one inch from the right edge on  the first line of each page, excluding the Figures page. In this introduction, you will state describe the purpose of your paper (the first rubric  element) – in other words, what your paper sets out to do. In this case, you are acting as a  consultant, providing a microeconomic analysis of a particular company and you will analyze  different microeconomic criteria related to your company and the market in which it operates. This analysis will then inform your recommendations for how the company can be successful in  the future. Be sure to provide some specifics about what you will be analyzing so the reader  knows what to expect – use the outline provided in the Final Project Document as your guide.

Lastly, make sure that the company you choose is well suited for this kind of analysis. Please see  the suggested list provided in your course for ideas and email your instructor your choice. Any  company not on the list will need prior approval.

History of the Company

Use headings and subheadings to organize the sections of your paper. The first heading level is formatted with initial caps and is centered on the page. Do not start a new page for each heading. This first heading aligns with the second rubric element which gives an overview of the company’s history. Be sure to personalize this heading to reflect your company. In this section, include you will summarize the history of the firm and also provide an overview of what the firm does and what goods/services it sells. Be sure to include sufficient detail here. Your company’s website is the best place to find this information. This section should be about one page long.

Supply and Demand Conditions

There are two rubric elements to be included in this section and combined they should be about 2 pages in length, perhaps longer if you present more than one graph/table. The first element asks you to evaluate the trends in demand over time and explain their impact on the industry and on the firm. To do this, you can consider market demand. Market demand is the demand by all the consumers of a given good or service. Find out who your customers are and provide detail on them. Use annual sales data to find out how much of the product is purchased.

Here is a video explaining each of the following determinants of market demand that you could examine for your company’s market:

o Income
o Price of related goods
o Tastes
o Population and Demographics
o Expected Future Prices

The second rubric element to be included in this section is your analysis of information and data related to the demand and supply for your firm’s product(s) to support your recommendation for the firm’s actions. You have already presented the overall trends in demand in the last element. In this rubric element, you will first collect data specific to your company on demand. To do this, look at the following:

Sales and Revenue. Building on the idea of market demand, consider how the annual sales data changed over time for your company in particular.
Include a graph/table/chart of sales for your company. This may be in dollars, product quantity or number of customers – whichever is most relevant for your firm.
You could use more than one, if you think that would give a more detailed picture of demand for your company’s product or service.

Include 5 or more years of data will be enough to show a trend that is supported by your market demand discussion.

Data can be found from the company’s annual reports and revenue can more specifically be found in the company’s income statement.

One you have analyzed the demand side, you can now look at the supply side of your company. For this, you will want to watch this video on the determinants of supply, just as we examined the determinants of demand in the last rubric element. Here, some of the pieces you could explore and provide data on are:

 Input costs
 Technological Improvement
 Prices of substitutes
 Number of firms in the market
 Expected future prices