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1 pages/≈275 words
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APA
Subject:
Business & Marketing
Type:
Essay
Language:
English (U.S.)
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$ 4.32
Topic:
Will Increasing Price of a Product Increase Firm Revenue?
Essay Instructions:
You were recently appointed as a manager of a small firm selling product X. Your first goal is to increase the firm’s revenue. Whiles contemplating on this, a friend suggested that increase the price of product X. With the knowledge of price elasticity of demand, do you agree with this suggestion? If Yes, why? If No, why not?
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Increasing Firm Revenue
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Increasing Firm Revenue
I would not agree with the suggestion to increase the price of product X. There are several reasons why I would not agree with the suggestion. First, price elasticity of demand has shown that the demand for almost any product decreases if the price is increased (Hu, 2019). Therefore, increasing the price will result in low sales of product X. The reduced sales would not help in any way to achieve the intended goal of raising revenue. Secondly, raising the price of product X may give a competitive advantage to other products in the same line. Lower prices are one of the factors that make a product have a competitive advantage (Hu, 2019). Therefore, an increase in price should be the last resort and should be well contemplated before bei...
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