Individual Report resit
Table of Contents
Demand, Supply and equilibrium
Market Structure Theory
Business report: Google Inc.
The business report analyzes business strategies and operations of Google Inc through applying microeconomic theories. The main objective of this report is to critically analyze the business operations and strategies of Google Inc. through an economist’s perspective. It shall also provide recommendation and suggestions on the business strategies of Google Inc to develop in-depth understanding about the microeconomic concepts. 1. Introduction
Microeconomic theories provide a deeper insight to determine behaviors of individuals and business entities decision to make effective use of allocation of its limited resources. It analyzes the business decisions and behaviors that are stimulated by the supply and demand of the good and service of the market that derives pricing decisions of product and services of the business. The purpose of this business report is to investigate critically analyze the operational strategies of Google Inc. through microeconomic models and theories. The business decisions regarding pricing and production are dependent on the demand and competitive behaviors of the agent. It is one of the major reasons due to which Google Inc.’s strategies are develop with respect to the stimuli prevailing in the market. 1.1 Company Profile
Google Inc. is an American multinational global technology services and product providers that aim to improve individuals’ connection with its products and services (Hephaestus Books, 2011). The main business segments of the business are its online advertisement technologies, research, cloud computing and software. However, the advertisement segment (AdWord and Ad Sense) of Google yielder higher revenues that provide low costing online advertisements for the products and services on a global platform (Annual Report: Google Inc., 2013). Google has transformed that way people look and share information through its search engine that has made it a global technology leader. Google Inc’s low costing strategies for the online advertisement has allowed the company to yield enormous profits. 1.2 Research aim
The aim of this research is to analyze microeconomic factors that affect Google Inc.’s operational strategies (pricing) to its new clouding. 1.3 Methodology
In order to conduct the research primary sources, that is, the annual report 2013 of Google Inc. has been used. To gather other information websites, Reuters, Google scholar, Google, Ebscohost etc have been searched using keywords, Google Inc, business, economic theories, analysis and case study. Updated operational strategies and latest updates of the Google Inc. have been used for the paper. 2. Literature Review
2.1 Demand Theory
The demand theory illustrates the relationship the prices of the commodities and consumer demands for the product or services (Wetzstein, 2013). The theory explains the wants and demands of the market that varies with the income level of the consumer. It tells that how the pricing of the commodities affects utility of consumers. 2.2 Demand, supply and equilibrium
The economic model of demand and supply illustrates the price determination in the market for the product or service (Wetzstein, 2013). The model explains that the price is set when the demand is equal to the supply. In other words, the consumer and suppliers agree at a particular price to acquire the commodity. However, the unit prices in competitive markets vary with the demand of the consumers and the quantity supplied by the producers. However, the economic equilibrium is found where the...
References: (2013). Annual Report: Google Inc. California: Google Inc.
Hephaestus Books. (2011). Articles on Google Services, Including: Google Answers, Blogger (Service), Google Product Search, Orkut, Google News, Google Groups, Gmail, Google Too. London: Hephaestus Books.
King, R. (2014, March 25). Google 's new cloud strategy: Apply Moore 's Law to prices. Retrieved from http://www.zdnet.com/googles-new-cloud-strategy-apply-moores-law-to-prices-7000027639/
Perloff, J. (2013). Microeconomics: Theory and Applications with Calculus. London: Pearson Education.
Wetzstein, M. (2013). Microeconomic Theory: Concepts and Connections. New York: Routledge.
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