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Operations Decision

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Operations Decision

Managerial Economics and Globalization ECON550
May 24, 2015

This paper will provide insight into the low-calorie microwavable foods in support of the company’s long run and short run operations. When it comes to low-calorie frozen meals there are many options; this paper will delve into two companies and look at their competitors. First is to outline a plan that assesses the effectiveness of the market structure for company operations. Next is to determine two factors which could cause a change in the market structure. Third is analysis of the short and long run cost functions given certain costing information. Then the paper will suggest a pricing policy to enable the food company to maximize profits. Finally, a recommendation of two actions the company should institute in order to improve profitability and deliver more value to their stakeholders.
Market Share
U.S. consumers have switched gears into a more sustainable path toward healthy eating, which is now influencing the relative growth rates of different food categories (Black Book, 2007). Healthier versions of packaged-foods products have grown rapidly in recent years. These include food products that are either organic, fortified with vitamins or minerals, have reduced sugar, fat, or salt content, are high fiber, soy-based or gluten/lactose-free. In the first assignment the frozen low-calorie food market was in perfect competition. As the popularity of the low-calorie frozen meals expanded the companies had to find a way to stay competitive in the new monopolistic market. A monopolistic competition is a model of competition which describes a common market structure in which firms have many competitors, but each one sells a slightly different product (Economics Online, 2015). These products are differentiated from one another by branding or quality and hence they are…...

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