Assignment 1 Essay Example | Topics and Well Written Essays - 1000 words - 2

Assignment 1 - Essay Example The company commands about 8 percent of the US TV households (Media General, 2013). The company donates funds to various community programs and helps in highlighting social problems through some of the documentaries (Media General, 2013). Accordingly, employees have an opportunity of volunteering their time in community service. The company is also committed to conserving the environment through recycling and limiting the use of natural resources like water and oil (Media General, 2013). However, the company must improve on the social performance through ensuring diversity in the workforce through recruiting more individuals from the minority ethnic groups in the society. In addition, Media General, Inc must allocate about 10 percent of its net income towards additional employment benefits and corporate social responsibility initiatives. There are several stakeholders in the organization. There are both primary and secondary stakeholders. The primary stakeholders have a direct and co ntractual relationship with the organization and include the shareholders, government, employees, customers, advertisers, business partners, and creditors (Kottler, 2012). The shareholders are the providers of capital while customers create demand for the company products. The creditors provide debt finance while the government provides for the legal framework for reinforcing the business contracts and security of organizational assets (Kottler, 2012). The advertisers provide revenues while business partners assist in various forms such as provision of telecommunication infrastructure and managerial expertise. The employees provide the human talent, skills and knowledge that are needed in executing the operations of the organization (Polonsky, 2005). The secondary stakeholders do not have a contractual and direct relationship with the company, but they desire the organization to adhere to certain social expectations. The secondary stakeholders include the public, the labor unions, a cademic and research institutions and special interest groups. The labor unions expect the organization to adhere to labor laws while special interest groups like minority groups expect the company to ensure diversity in the staff. Advocacy groups like environmental conservation groups expect the company to exert efforts in minimizing pollution, highlighting social problems like disasters and child labor (Polonsky, 2005). Academic and research institutions expect the organization to contribute towards creating employment while the general public members are interested in the long term existence of the company. There is a trade-off among the interests of various stakeholders in the organization. It is my duty as the CEO to harmonize the conflicting interests of stakeholders and ensure the organization meets its goals of improving the social performance (Kottler, 2012). For instance, the shareholders expect a higher than average rate of return on their investment in the company. The b usiness partners and advertisers expect representation in decision-making. On the other hand, employees expect the company to adhere with their contractual agreements, pay high salaries and offer additional benefits (Kottler, 2012). The customers expect appealing news and continuous provision of new information. In this regard, the stakeholders can either facilitate or

Micro Economics Essay Example | Topics and Well Written Essays - 2000 words

Micro Economics - Essay Example The maximization of profits by a monopolist is shown in the diagram below. The necessary condition is that the marginal cost equals the marginal revenue and the sufficient condition is that the marginal cost curve has a greater slope than the marginal revenue curve at the intersection (Koutsoyiannis, 1975). Observe since the equilibrium price is higher than the average cost of production the equilibrium output, the monopolist makes a profit. This profit is shown as the shaded region in the diagram. Figure 1:Monopolist's equilibrium A typical reason for monopoly to occur is increasing returns to scale. If a particular firm has increasing returns to scale in any particular commodity, it has a natural advantage over any other firms in that market. This situation is known as natural monopoly. Monopoly can also occur through government regulation. There can be particular sectors in the economy that government run institutions run. Private entrepreneurship is not allowed. It may also be th ese industries require so high overhead costs private producers can’t afford it. The biggest disadvantage of monopoly is that it leads to exploitation of consumers. Particularly, this is true if the monopolist uses price discrimination to extract the entire consumers’ surplus. However, as first argued by Schumpeter (1950), the monopolist’s extraction of surplus is essential for economic growth. In competitive markets, the producers have to be content with zero profits. Investment returns are normal. Consequentially, the firm cannot invest in research and development which drives technological growth and innovation. However, since the monopolist is able to derive a surplus, it can invest this in research and development funds to attain technological competence. This is crucial for the monopolist or other big firms in order to retain their status as market leaders. And typically, technological innovation is what drives economic growth since it enables the resource s of the economy to become more productive thereby breaking free of capacity constraints (Varian, 2006). Therefore, an economy can have benefits as well as damages if a monopolist is in charge of a particular market. Monopolistic competition however is a market which combines features of Monopoly as well as perfect competition. Monopolistic competition is a market comprising of numerous buyers and sellers. However, unlike perfect competition, here products are differentiated. Every seller thus is a monopolist for his own product (Ison & Stuart, 2006). The producers now are not mere price takers. They simultaneously set price and quantity to maximize prices. However, entry is costless and therefore as long as there are positive profits, new firms enter the industry. As a result, monopolistically competitive firms can only earn zero profits in the long run equilibrium (Varian, 2006). Typically, monopolistically competitive markets are what we observe the most in the real world (Koutso yiannis, 1975). Markets start off with very few producers, but attracted by profits new firms enter. As competition intensifies, firms try to differentiate their products through advertising or introducing new varieties. The biggest advantage of monopolistic competition is that firms offer horizontally as well as vertically differentiated products and this results in better matches with consumer preferences. In the long run, there are no barriers to entering or exiting the market. As long as firms make supernormal profits, new firms