Author Author Affiliation Introduction













Author Affiliation




Title of Paper

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

companys 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 companys

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 companys 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 firms product(s) to support your

recommendation for the firms 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 companys 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 companys annual reports and revenue can more

specifically be found in the companys 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


Price Elasticity of Demand

This section has three elements and should be 1-2 pages long. The first element asks that

you analyze information and data to justify how the price elasticity of demand for your



product is determined. Here, you will have to use pricing of your product, the trend in the price

over time and comparison to similar products to justify whether you find the price elasticity of

demand to be either elastic or inelastic. You may not be able to calculate a specific price

elasticity of demand (video), depending on your company and the available information.

However, looking at pricing data should help you justify whether demand is inelastic or elastic.

You will then take your justification one step further in the second rubric element and

explain the factors that affect consumer responsiveness to price changes. You can learn more

about these factors from this video on the determinants of price elasticity of demand. Explore the

following determinants as they relate your companys product(s):

Availability of substitutes

Passage of time

Luxury or necessity

Definition of the market

Share of budget

The third and last element in this section ask you to assess how the price elasticity of demand

impacts the firms pricing decisions. As you read in Chapter 6 in our textbook, there is a

relationship between elasticity of demand and revenue. You can watch this video to review the

relationship between price elasticity of demand and total revenue and explain how this

relationship influences the companys pricing decisions. For instance, if a company sells a

product that has very elastic demand, meaning customers are very responsive to a price change,

then increasing their price means that their total revenue will decrease. This could explain why,

in such a situation, the company may decide to not raise prices, even if their costs are going up.



This is just one example so be sure to make your analysis relevant to your companys specific



Costs of Production

This section of your paper has two rubric elements and will be between 1-2 pages long,

depending on your use of graphs or tables. The first element in this section asks you to analyze

the various costs your company faces, their trends over time and how they have impacted

the companys profitability. To gather data on this, you will want to go to your companys

annual report and look at their income statement. Here is a helpful video to help you understand

how to read an income statement. You will notice that there are two section that deal with costs

the first is Cost of Goods Sold which is essentially the cost of the inputs, such as raw material

and direct labor. For clothing manufacturer, that would include the cost of the cloth; for an auto

manufacturer, it would include the cost of the steel. Then, there is the section called expenses and

these are the costs beyond buying the raw materials. These include things like rent, insurance

and overhead and other indirect expenses. For this section, you should include:

Past 5 years (or more) of COGS, in a table or graph

Past 5 years (or more) of Operating Expenses, in a table or graph (can be combined

with table/graph of COGS)

Explanation of any observed trends in either (ie: why is COGS increasing?) such as:

o Pricing history of major inputs, such as cotton for a clothing company, as


o Change in how goods/services are produced for instance, a change in major

input such as moving from steel to aluminum



Your analysis of how changes in either or both of these affected profitability

remember that accounting profit, which is what we are looking at here, is simply

Revenue Costs

The next rubric element in this section asks you to apply the concepts of variable and fixed

costs to company for informing their output decisions. Chapter 11 examines the differences

between variable and fixed costs, and you can review in this video the details about fixed and

variable costs and how they apply to business output decisions. In this video, our textbook

presents an example that shows how costs are distinguished between fixed and variable. This

example will help shed light on how you can similar distinctions for your company. Also, you

have already done some of this work in your previous rubric element. There you presented data

on COGS and Operating Expenses. Generally, variable costs will show up in COGS and fixed

costs will show up in Operating Expenses, so this gives you a head start. You can then use the

data and your knowledge of fixed, variable and total costs from Chapter 11 to explain how your

company will base their production level on the costs they face.


Overall Market

In this section, you will be examining three different aspects of the overall market in

which your company operates. By overall market, we mean the market selling the product or

service. For instance, there is a market for mobile phones or a market for jeans. Whatever

product your company sells determines what market it is in. Note that the term market here does

not refer to the stock market. In total, this section should be 1-2 pages long.

The first rubric element of this section asks you to discuss the market share for your

company and its top competitors by providing details on current percentages for each



company and describing the trend over time. The best way to show this would be to use some

type of graph or table to show for the past few years (5 would show any trends, if you can find

the data going that far back). To do this, you will need to find data on the market as a whole

for instance, if the market is computers, you will need to find the total value of computer sales in

the US. From there, you can determine that share (the percentage) your company and the other

top companies get from that total. For an example of how to do this, check out this video on

calculating market shares. You may also find that industry magazines or other market

researchers have compiled this information, so do look for those resources as well, to make your

data collection easier. Once you have the data, you will want to see how your company has been

doing. Having 80% of the market might sound great but if you see that the company had 90% of

the market two years ago, then we have a different story. This is why showing the trend is so


The second rubric element in this section asks you to analyze the barriers to entry for

your firms industry. This concept is explored in detail in Chapter 14 and you can review in this

video the types of barriers to entry and their impact on the market. For the market your company

operates in, you will detail the barriers to entry some markets have more than other and some

barriers are weaker than others. Your specific situation will allow you to explain how the existing

barriers will either help insulate your company from competition or allow for competitors to

break into the market.

The last rubric element in this section asks you to describe the market structure for your

firm and analyze how this affects their ability to influence the overall market. Recall from

Chapter 12 that there are 4 different market structures: Perfect Competition, Monopolistic

Competition, Oligopoly and Monopoly. You need to categorize your companys market into one



of these four. Use the criteria listed in Table 12.1 on page 392 of the textbook and any

supporting evidence you have presented so far. You can also use the four-firm concentration

ratio and/or the Herfindahl-Hirschman Index (HHI) to support your conclusion. Here is a video

showing you how to calculate both the four-firm concentration and the HHI*, and you can also

review this on pages 453 and 497, respectively. Once you have determined the market structure,

you can then analyze your companys ability to influence the whole market based on this and

their position within the market.

*this example uses the top 50 firms you will not necessarily have to use that many.



This last section of your paper contains three rubric elements, where you will provide your

recommendations for future actions based on the three different criteria. This section will be

about one page long. In the first element, you will develop a recommendation for how the firm

can manage it future production by synthesizing the data presented. This essentially is

asking you to look at the data and analysis done in the supply and costs sections and make a

suggestion how the company should produce in the future. The determinants of supply and

specific costs trends that the company faces will determine what you suggest for their production

moving forward, in terms of quantity and types of products.

The second element asks you to suggest how the firms position within the market and

among its competitors will allow it to take the recommended action. This follows closely

from your last element in the Overall Market section and you should use the evidence presented

there to inform your recommendation here. Specifically, consider how the firms market power



would allow them to make the suggested changes to production you mention above. You should

also include here advice for how your firm can become stronger within their market.

The last rubric element asks you to describe how the firm can sustain its success going

forward by evaluating trends in demand and price elasticity. Here you will revisit your

analysis in the demand and price elasticity section to further provide suggestions for how your

company can stay profitable. From pricing decisions to responding to changes in demand, your

suggestions here should reflect your findings in those earlier sections. Be sure to include specific

ideas for how the firm can remain successful, like new products to offer based on changing

tastes, or a different pricing strategy to remain competitive. Your ideas should of course align

with the rest of your analysis and the microeconomic concepts.



This is not a particular section of your paper, but rather guidance on how to use APA

format in-text citations throughout your paper. Source material must be documented in the body

of the paper by citing the authors and dates of the sources. The full source citation will appear in

the list of references that follows the body of the paper (see last page). When the names of the

authors of a source are part of the formal structure of the sentence, the year of the publication

appears in parenthesis following the identification of the authors, for example, Smith (2001).

When the authors of a source are not part of the formal structure of the sentence, both the authors

and years of publication appear in parentheses, separated by semicolons, for example (Smith and

Jones, 2001; Anderson, Charles, & Johnson, 2003). When a source that has three, four, or five

authors is cited, all authors are included the first time the source is cited. When that source is



cited again, the first authors surname and et al. are used. See the example in the following


Use of this standard APA style will result in a favorable impression on your instructor

(Smith, 2001). This was affirmed again in 2003 by Professor Anderson (Anderson, Charles &

Johnson, 2003).

When a source that has two authors is cited, both authors are cited every time. If there are

six or more authors to be cited, use the first authors surname and et al. the first and each

subsequent time it is cited. When a direct quotation is used, always include the author, year, and

page number as part of the citation. A quotation of fewer than 40 words should be enclosed in

double quotation marks and should be incorporated into the formal structure of the sentence. A

longer quote of 40 or more words should appear (without quotes) in block format with each line

indented five spaces from the left margin.




Entries are organized alphabetically by surnames of first authors and are formatted with a

hanging indent. Most reference entries have three components:

1. Authors: Authors are listed in the same order as specified in the source, using surnames

and initials. Commas separate all authors. When there are seven or more authors, list

the first six and then use et al. for remaining authors. If no author is identified, the

title of the document begins the reference.

2. Year of Publication: In parenthesis following authors, with a period following the

closing parenthesis. If no publication date is identified, use n.d. in parenthesis

following the authors.

3. Source Reference: Includes title, journal, volume, pages (for journal article) or title, city

of publication, publisher (for book).

Here is a link to a video to walk you through creating a reference list in APA format.


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