How market structures determine the pricing and output decisions of businesses Essay

3.1 Explain how commercialise structures determine the pricing and outturn decisivenesss of telephone circuitesThere argon different kinds of marts in different economies/sectors/goods. Accordingly, in that location are different kinds of output and pricing decisions which take place. Usu anyy, output and pricing decisions are interdependent except for the case of abruptly competitive markets. In perfectly competitive markets, a single firm is so small compared to the market that it can non chance upon the prices. In that case, it must take the price as given, and then get back the quantity to be supplied. Price in this market is fitted to the marginal cost of wareion. In monopoly, however, things are different. The monopolist can spay the prices, as it is the sole provider of the good and thus has the market power. however here in like flair, if the price ontogenys quantity entreated decreases. Therefore, the monopolist must take at a lower place consideration both the positive and negative effects of gain in prices. In another market oligopoly, pricing is a bit to a greater extent complicated and it depends upon the st regularizegic fundamental inter do among the firms. Market structure is the number of buyers and sellers in a market.There is different market structures much(prenominal)(prenominal) as consummate(a) Competition, Monopoly and Oligopoly and are discussed below A place where different sellers of the same ware then the firms price purpose and the output decision depends upon the requirement for their products. In a competitive market buyers actually decide the price and firm take the output decisions as compare to the require for the product because every firm tries to offer lower prices to their customer to increase their market share is cognise as Perfect competition. A scenario/market structure where a sole provider then price plan and output decision lies by the firm because in a noncompetitive market the firm is the price maker and they can charge any(prenominal) price they want and customer turn out to pay because customers provide not have the choice to buy somewhere else with a lower price, In Pakistan we can find such an example with WAPDA.This is k directn as a monopoly. Market structure where several sellers of the same products then the sellers have a bit of command over the price due to the ongoing rate for their products. For example they all charge the same price and then it depends upon the customers from whom to buy. Sellers whitethorn charge the same price but there will be difference in the way they advertise their productsand attract customers to purchase their products, known as Oligopoly. 3.2 Illustrate the way in which market forces shape organisational responses using a range of examples Forces that determine the price level in the economy. Market forces can be a number of elements such as demand, supply, indispensable stakeholders, customers and providers. Two things ca n happen with the demand and the agreements are derail to give.If the demand for product increases the fundamental laws response for the increased demand will be they will hire more oeuvreers and will issue with full capacity. If the demand for the product decrease there will be decrease in cash inflow of organization due to which their be will exceed than their profit. Organization response for such situation will be that they will shorten jobs of their employees to cut their costs. Same as the demand two things can also happen with supply of the products. When there is increase in supply of products the demand will decrease while if there is a decrease in supply of the products the demand will increase. Employee is also the factor that can change the demeanor of the organization. If government announces mini engross the organization must accept it and must pay their plumpers with a lower limit lease. If do not pay it to their workers, their employees will leave their jo bs and will work for other organizations.Every organization aim is to avenge their customers with their products. If any organization producing fashion product but they do have continuous fundamental interaction with their customers as fashion changes after every specific time cessation the organization will lose their customers because they wont be sufficient to fulfill customer requirements and wont be able to satisfy their customers with their products. An organization is dependent to its supplier and without supplies the business process is unable to run. If supplier increases price for the raw materials it will automatically increase the cost of production of an organization. 3.3 Judge how the business and cultural surroundingss shape the behavior of a selected organization Political decisions also have an impact on business activities such as health and education for workers and the infrastructure of the economy. Nokia transferred one of its manufacturing facilities to In dia, it is important that Nokia have to follow all the rules in regulations set in India. The rules and regulations by India for Nokia may include that Nokia must be aware of the minimum wage, working hours per hebdomad and health and safety for workers etc.All the unseasonedlaw and regulations by the government affect Nokias operations. Economic factors may include the frugal situations as a whole. These factors include interest rate, exchange rate, inflation and economic development etc. Nokias Economic situation in Finland went to recession period once which decreased the level of income and resulted in decrease in demand for Nokias product. Due to an increase in costs Nokia cut jobs and unemployed some of their employees. Nokia must be aware of all such economic situations to be ready to handle them well. hearty is about the society. Social factors may include change in taste, change in level of income, change in fashion etc. All the above factors affect the demand for the product normally it happens with Luxury and fashion products. Nokia operates in all over the world with their products and consider the culture of every place they operate, now a day people want to have good feeling and smart up to date phones, Nokia tries to be aware of every brotherly trends in the society and come up with the demanded products by their customers.Technical this refers to a change and development in the way of production, as new engineering improved the quality of products, increase in productivity etc. wakeless the new laws applied on businesses by the government. Government passes different new laws after every specific time period which increases cost of the businesses. such(prenominal) laws may include age discrimination, increase in minimum wage etc. For example, Apple operates where it is very difficult to have a product different from its competitors. environmental factors include a change in weather, climate. Environmental changes affect businesses such as farming and tourism. Environmental factors are the outside(a) factors which firms have to consider due to a global change in the economy. Nokia must be friendly with their customers to operate in appropriate manner as they water proof cell phones, phones with a plastic personate which can be unbreakable etc. Environmental Culture is the attitude, behavior and the knowledge in a society is called the cultural environment.Cultural environment can be of two types Internal Culture Any attitude, behavior, action or policy developed among people in the company is called the internal culture of the company. Apples internal culture is that there is a team work system among employees and every employee has the freedom to give in input of their ideas for the triumph of the company. External Culture companys own mission and of necessity of the customers that the companycan quickly respond is called the away culture. Nokias external culture is that they give customers service to their customer as their first aim is the customer satisfaction and to achieve such satisfaction they always try to come up with high quality of products. Nokia always have an interaction with their potential customer to gain new ideas from them. Nokia always conduct their business in ethical, legal and socially responsible fashion.