Elasticity of Demand in Healthcare Pricing
Respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions by your classmates. Be substantive and clear, and use examples to reinforce your ideas.
One of the basic principles of economics is supply and demand., It is integral in how we consider the appropriate price for our product and how the change in price might influence the demand., We know intuitively that an increase in price will reduce demand but by how much?
Keeping this in mind, please answer the following:
- Explain the concept of elasticity of demand. Discuss how the competitive environment influences elasticity of demand. Examples include the following
- Monopoly
- Oligopoly
- Monopolistic competition
- Perfect competition
- How would you, as a manager or leader, factor elasticity of demand into the decision-making process of raising prices with profit maximization in mind? Discuss an example.
Understanding economics is paramount to running a successful business. Managers must understand how to optimize production choices and forecast the following:
- Market trends
- Revenue
- Expenses
To accomplish these goals, comprehending consumer choice and consumer demand for the good or service being produced or provided is important. This assignment helps you apply the foundational principles of economics.
Choose 1 of the following economic concepts:
- Profit maximization
- Consumer choice
- Supply and demand
- Optimization
Write to address the following:
- Introduce and explain in detail the economic concept you have chosen. Explain the assumptions and limitations that are associated with the economic concept.
- Select 1 quality article that applies the concept you have chosen. Describe how the concept was applied in the article.
- Discuss how a manager might apply this concept professionally to make decisions or improve profit.
What limitations might be considered by the manager? - Provide a conclusion that highlights the key points. APA