Economic Case Study
Required Report: Economic Case Study
I. Classify the firm into one of the four basic market models
A. Select a company from a current business periodical or where you work, and state which market model is represented by this company. Explain your reasoning using a narrative format. (Refer to CHART on market characteristics in the study guide.)
B. State the basic industry problem and proceed to analyze using the following methodology where appropriate. Be sure to include the six (6) graphs, as indicated.
c. Watch the supply and demand analysis video series (Steps 1, 2, and 3) provided for you in this module to help you create your supply and demand graphs.
D To learn how to create graphs in Microsoft Word you may view the video called
Economic Class – How To Make Graphs in Microsoft Word.
(Links to an external site.)
II. Supply & Demand and the Price System Graphs
A. What is the current demand situation – is the curve changing (use graphs)?
Graph #1: Demand Curve and any Changes (CHOOSE ONE):
1. Curve shift and underlying causes
2. Movement along the curve and causes
B. What is the current supply situation – is the curve changing (use graphs)?
Graph #2: Supply Curve and any Changes (CHOOSE ONE):
1. Curve shift and underlying causes
2. Movement along the curve and causes
C. Market Equilibrium (use graphs)
Graph #3: Demand & Supply Curves with Changes
1. Surplus/shortage (where appropriate)
2. Price ceilings and price floors (where appropriate)
D. Changes in Income & Results
1. Superior/normal or inferior goods
E. Changes in Prices of Related Goods & Results—CHOOSE ONE:
1. Name a Substitute, complement, or independent goods
III. Costs & Profits: From the article see if the company is above target (Eco. Profit), on target (Normal profit) or below target (Loss).
A. Short-run Costs (use graphs)
Graph #4: Short-run Profit or Loss (use MC, AR, ATC, and AR; shade where appropriate) (refer to Work Book PG. 224)
1. State whether firm is earning a normal or economic profit, or a loss. Illustrate on graph 4.
2. State any productivity and pertinent cost problems and the resulting effects on graphs. . Long-run Costs (use graphs)
Graph #5: Long-run Profit or Loss (use MC, AR, ATC, and AR; shade where appropriate) (refer to Work Book PG. 224)
1. State whether firm is earning a normal or economic profit, or a loss. Illustrate on graph 5.
Graph #6: The Planning Curve: LRATC & Optimal Plant Size (Economies & Diseconomies of Scale) (refer to Work Book PG. 181
1. Graph the LRATC, show economies and diseconomies of scale, and mark with an “X” the company’s position.
IV. Conclusion/Summary
A. Recapitulation of Findings
B. How could the economic problem be corrected?
V. Prediction for Future
A. State your personal prediction for the future. Support your answer.
Note: Your paper must be 3-4 typed pages in length including your graphs. You must include a copy of the article you used in your research. Please attach your article to this paper, You must submit your paper either in person on paper with a proper cover page or online by clicking on Submit Assignment in the upper right side of your screen.
