The First Step in the Forecasting Game Plan Is to Project

question 22

Essay

The first step in the forecasting game plan is to project sales and other other operating activities. Sales numbers are determined by both a volume component and price component. Projecting prices depends on factors specific to the firm and its industry that might affect demand and price elasticity. For the following types of firms discuss whether it would be likely that the firm would be able to raise future prices:
a. A firm in a capital-intensive industry that is expected to operate near capacity for the near future.
b. A firm in an inchustry that is expected to experience numerous technological improvements.
c. A firm with products which are transitioning from the growth to maturity phase of the prochict life cycle.
d. A firm that has established a well known brand name and image.

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Definitions:

Market System

In this economic framework, the determination of investment, production, and distribution is influenced by the market signals emanating from the interplay of supply and demand.

Economic System

The mechanism or set of processes by which a society organizes and distributes its resources, goods, and services.

Factors Of Production

The four economic resources: land, labor, capital, and entrepreneurial ability.

Economic Systems

The structure and methods by which a society allocates resources and distributes goods and services among its population.