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Assignment Business and Managerial Economics Teacher: Ellie Semsar Student Name: Robiul Islam Student ID: B0261DADA0410 Personal computers are very imperative in the current world of nowadays. Today, PCs hold fabulous consequence. Several numbers of us will be thrilled without a computer, as it becomes a part and parcel of our daily life. Computer becomes a significant tool for keeping archives. For computer data analysis become tremendously easy and we can do it now in a single mouse click. Now-a-days though the demand of personal computer is increasing rapidly but it price also falling day by day.
There are some particular reasons of it, what is given underneath: * Production cost * Price inflation * Perfect competition market structure * Technological improvement * M-commerce * Inelasticity of product Though, we can think that demand of the personal computer is going up day by day for its effectiveness. There is also a close relationship between population and demand in economics. Because, as the factor of demand we know that, if population goes up demand also go up. Population^ = Demand^ If population increase from P1 to P2 demand also increases from D1 to D2.
Production cost of computer: now most of the computer manufacturing companies don’t have big stores everywhere. Most of them are now selling their product by the website. They are selling computer by taking order at website. For that reason they don’t need rent a show room or a place to make a store. Before, all the companies used to have lots of employers to attach the computer products. But now everything is doing robot. So, the manufacturers don’t have to spend a huge budget for the employees. This reasons cut down huge amount of production cost.
So, if they want they can also minimise the profit they earn each year. In economics we know that if the production cost rise supply goes down. But, if manufacturing cost like land, labour, capital, wages, interest etc. goes down supply goes up. It causes a shift to right in the supply curve. Price factors of productionv = Supply^ If production cost decreases from P1 to P2, supply Increases from S1 to S2. Also now-a-days there is lots of computer manufacturing companies. Like: Microsoft, dell, Acer, Toshiba they have vast range of computers. When there is many producers the price also goes down.
Number of produces ^ = Supply ^ In market when the supply goes up price goes down. Price elasticity of personal computer: Price elasticity of demand: It is a amount used in finances or economics to demonstrate the receptiveness, or elasticity, of the amount demanded of a good or service to a change in its price. Furthermore, it shows the percentage change in quantity demanded in reply to a one present alteration in price if all the other demand become constant. Price elasticity in demand is comes from the percentage change in quantity (%? Qd) and in price (%? P).
Personal computer is a perfectly elastic product. Because, this is not a basic need for people to have a personal computer. The basic need of the people is food, home etc. but, it can be vary to the living style of people. There are many manufacturers whose are manufacturing computers. So, for that reason consumers have lots of option when they intend to buy a computer. This made computer price down or constant. This product is in perfect competitive market. For this reason if any company increase the price customers will not buy that. They have lots of other options.
Perfectly competitive market structure: Perfect competition defines markets where, no one contestant is big sufficient to take the power of the market to set the price of a similar good. Because, in perfect competition the conditions are very strict. The number of perfectly competitive market is minimum. Perfect competition assists as a standard contrary to which to measure actual and incorrectly competitive markets. Basic structural characteristics of perfect competition market In perfectly competitive market structure every contestant is a “price taker”. No contestant impacts the worth of the goods it buys or sells.
Detailed characteristics may contain: * Infinite buyers and sellers – Immeasurable clients with the inclination and capability to buy the product at a convinced price, and unlimited manufacturers with the readiness and capability to supply the product at a definite price. * Zero entry and exit barriers – it’s a free entry and free exit market structure. * Perfect factor mobility – In long term the factors of the market will gather mobility. * Perfect information – Rates and excellence of products are expected to be known to all customers and manufacturers. No exchange costs – Consumers and retailers experience no costs to do an transection (perfect mobility). * Profit expansion or maximisation – if manufacturer can sell their products when marginal cost will be equal with the marginal revenue. They can make some profit on that occasion. * Similar products – The characteristics of any assumed market product or facility do not differ through dealers. * Constant returns to scale – when there will be sufficient firm in the industry the constant will return to sale.
Temporarily, perfectly-competitive markets are not productive as production will not ensue where minimal cost is equivalent to average cost. . Below perfect competition, any profit-maximizing manufacturer gets a market value equivalent to its average cost. This suggests that a reason’s rate equivalents the aspect’s average revenue of the product. A manufacturer’s or firms demand curve will be perfectly elastic when it will be in perfect competitive market. So, this is why in perfect competition market structure manufactures of computer can’t raise the price of the product any time they want.
Technological improvement: The first computers were massive machines with hundreds of vacuum tubes that were by no extent of the imagination personal. The average user was a middle-aged man who wore a white coat as part of his job as engineer, working either for a government entity or a large corporation. During this time in the PCs development, codes were entered by flipping a long series of switches. Computer technology has advanced at an increasingly rapid rate. Computers have come very far from the humble beginnings in the server room.
Their speed has increased greatly, while, at the same time, they have been becoming increasingly powerful. About ten years before, a top class computer structure contained of a 16 MHz processor, 256Kb RAM and a 20MB hard disk drive. Then they added a dot-matrix printer a 16-color graphics monitor and a 16-color graphics monitor. It was system which was more satisfactory to run the database applications, spread sheet and DOS-based word processing on that time. Obviously, you had to learn complex key sequences to do anything with these applications.
Technological improvements in today’s computers: * Software of the computer becomes far most sophisticated and much easier to use. * Now, word processors have a variety of fonts, grammar checking, spell checking and lots of features. * In place of DOS operating system now we are using windows 7 which have easy to use icons, desktop access to files, internet and more. * The whole hardware system of computer is now too much up-to-date before 10 years. Previously, the computer manufacturer used the light diode to make a processor. Which usually take too much time also it was a hard work.
Now they are using microprocessor chips. This is light in weight and also too much updated than previous time. Now, people are spending money for more sophisticated things than computer also more powerful. Recently giant computer manufacturer company apple introduced a new product. Its name is i-pad. People can you every work of their computer in the i-pad by a single touch of their finger tip. The computer industry is not the largest industry—yet—but it will be number one by the turn of the century. The computer industry is already the most important industry.
Computer technological prowess is now considered a most important resource (if not the most important) by many companies and by many countries. Most industrial countries, including the U. S. , Japan, Brazil, and several European nations, are funding specific programs and using incentives to catch up or get ahead in computer technology. In order to see how much computers will improve, we must understand the current technological status of computers. In the last 20 years, the spectrum of computers has proliferated until today there are nine distinct, but overlapping, computer product segments M-commerce:
Once upon a time when people used to do there every essential work in their personal computer. But now situation has changed. People are spending more time in their cell phone. Because, today cell phone or mobile phone is too much powerful that people can do every single work by their mobile phone. As technical structure grows for mutually individual computers and mobile phone some variances still persist. Size 1. Mobile phone is too small than a computer. Personal computers are much larger than a cell phone and require a monitor or external display to view information or document on them.
Also it need a keyboard to input data, and a mouse to direct. So, for this reason, mobile become too much effective and also necessary to all. Internet 2. Many new mobile phones contain operating systems like computer and allow Internet access just like computers do. Now a day’s mobile screen also become big and can perform an order just a finger tips. Storage 3. Now mobile phones have much more built in memory and are frequently well-matched with honestly large memory cards, it’s not too far away when mobile phones will also have huge memory like computer’s hard drive. Cost 4.
Tough the advanced mobile phones price remain under $1,000, but personal computers can cost some thousands of dollars depends on alterations installed in them. One of the latest smartphone iPhone operating system comes from another operating systems which are connected to Unix. Palm’s Web OS and Google’s Android are constructed on top of Linux. Smartphones can classically view and occasionally edit documents (i. e. from Microsoft Office). Now several cell phones have complete QWERTY keyboards like computer, this is an elementary condition for smartphones. Mobile commerce was started in 1997.
On the first two mobile-phones allowed Coca Cola vending machines were installed in the Helsinki area in Finland. The machines accepted payment via SMS text messages from the mobile phone. In 1997 the first online banking started by Merita Bank of Finland. The online banking also used sms technology. Products and services available on m-commerce Mobile ticketing Various kind of ticket starting from cinema ticket to travel ticket everything can be purchased by mobile phone now. People can also book ticket by cell phone. Location-based services People now can use gps navigation or Google maps from their mobile phone.
By which they can reach or find their proper destination. * Local discount offers * Tracking and monitoring of people * Local weather Information services A variety of info facilities can be carried to mobile phone users. These facilities include: * Traffic reporting * Sports scores * News * Stock quotes * Financial records Mobile banking People now can easily do mobile banking securely and also easily by their cell phone. They can also transfer money and can also receive money by this. Mobile brokerage Mobile Brokerage can be also done by cell phone. Now people can get all the news of stock exchange on their mobile screen.
Mobile Browsing By mobile phone internet browser customers can surf internet and can order any product worldwide from any country. Mobile Purchase Via the customer’s mobile device catalogue merchants can receive orders from clients automatically, by the consumer’s mobile device. In some cases, the wholesaler may even supply the catalogue automatically, slightly than sending a paper catalogue to the consumer. Some traders deliver mobile websites that are personalized for the slighter screen and partial user interface of a mobile device. Mobile marketing and advertising
In the framework of mobile business, mobile marketing discusses to selling to mobile devices. Firms have described that they see improved response from mobile marketing campaigns. To conclude PCs have enlarged part in daily life of human being. The major evidence is existing at our surrounds. Just taking a look everywhere at our surrounds will be sufficient to verify the connection of computers in daily lives. Shopping, stocking, literature, entertainment traveling, public sector, private sector, banking, literature almost all over computers are performing their roles competently.
Computers can be nominated as a most inventive revolution of humans. Though computer manufacturer are facing price dropping. I think like apple i-pad or new smart mobile phones they can make computers more sophisticated than any other time. References and bibliography * http://www. ehow. com/about_6326510_improvement-computer-technology. html#ixzz14S5DyGoY * About Improvement in Computer Technology | eHow. com * http://portal. acm. org/citation. cfm? id=42040. 42093 * Managerial economics and business strategy/ Michael R. baye * Essentials of economics/ john sloman * Economics for business/ john sloman