Group+2-kimberley,dorcas,amelia,yijun,amandatoh

What abt marketing decisions? If Apple expects dd to increase/ decrease, what would they do?
 * ~  ||~ Student's Posts ||~ Teacher's comments ||
 * Project A || [[file:Project A.docx]] ||  ||
 * Project B || [[file:Project B_edited3.docx]] || While you've pointed out some good points both from producers and consumers' point of view, you did not link it to the impact on dd/ss and thus on eqm price and qty. For e.g the part on the increase in income. And so how will that affect the dd for iPad? and thus the eqm p and qty? What you are doing instead is how Apple could solve the shortage prob? And does Apple constantly increase/ decrease their prices?

Much better. Look at my edited file for comment. But need to work suggestions for marketing strategies that Apple would want to implement. || However, have you answered the qn as to how it will affect Apple's pricing and marketing decisions? ||
 * Presentation materials || [[file:Group2_Presentation_edited2.ppt]] || Your presentation actually covers the impact of changes in dd and ss which should be included in your word doc for project B.

Comments:


 * __Project A:__**

1. On January 27, 2010, Apple introduced the iPad. However, a 1972 research paper published by a Xerox PARC scientist already recorded the idea of “iPad”.

2. Price of iPads is determined by demand and supply in the market. Apple is able to minimize its cost of production for every unit as it pays a lower price for semiconductor parts than most of its competitors. Apple has a major supply chain management advantage as its components of iPads are produced and bought in bulk. Also, Apple sells its iPad at a low price to develop a devoted audience of customers quickly and gain market share, hence increasing the direct sales of iPads to consumers. Even at low selling price, Apple still reaps huge profits.

3. Related products for iPad are tablets manufactured by other brands like Toshiba, Motorola, Samsung, Microsoft, Vizio and Sony. In the market, there are HP tablet pc, Android tablet pc, BlackBerry PlayBook, Compal Tablet, Notion Ink Adam, MSI, HP Slate, Dell Streak, Asus Eee Tablet, MSI, Quanta, ICD Vega and Google and HTC. These tablets are related to iPad because they have similar functions of allowing users to surf the internet, watch videos and play games.

Source:

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 * __Project B:__**
 * __Improved state of technology__

Improved state of technology implies that there is an increase in the supply of iPads as the production rate increased. At the same price, there would be a surplus of the product. When there is a surplus, there is a downward pressure placed on the price as consumers are now less willing to offer higher prices. As the price decreases, the quantity demanded will rise and the quantity supplied falls, thus reducing the surplus. This will continue until the surplus is eliminated at the equilibrium price. Improved state of technology includes the usage of machines to make the products instead of relying on manual labour. Resources can thus be fully utilized, allowing faster production of the iPads, while manual labour can be used in areas such as R&D. Changes due to abnormal circumstances such as natural disasters cause a decrease in the supply in the market as producers lack resources to meet demands. This causes a shortage as quantity demanded is more than the quantity supplied, putting and upward pressure onto the price as consumers are willing to offer a higher price. As price increases, the quantity demanded will fall and the quantity supplied will rise, thus reducing the shortage. This will continue until the shortage is eliminated at the equilibrium price. Earthquakes at Japan have forced component manufacturers to shut down their plants. 40% of the world’s NAND flash and 15% of the world’s DRAM are manufactured in Japan, who is a significant source of chips to consumer’s electronics, causing price swings and large near-term shortages. This is a sudden decrease of resources need for production. Rise in the consumers’ income due to the improvement in economy provides consumers a higher purchasing power. Consumers are thus able to spend more on normal goods. This would mean an increase in demand for normal goods such as iPads. This causes a shortage as quantity demanded is more than the quantity supplied, putting and upward pressure onto the price as consumers are willing to offer a higher price. As price increases, the quantity demanded will fall and the quantity supplied will rise, thus reducing the shortage. This will continue until the shortage is eliminated at the equilibrium price. Singapore’s economy has been improving for the past few years. This causes an increase in the incomes of the working population of Singaporeans. This will cause a decrease in demand for inferior goods, and an increase in demand for normal goods, such as the iPad, as the consumers have a higher purchasing power. Change in prices of substitutes would mean that a small change in price of the substitutes would cause a difference in quantity of iPad sold. With close substitutes, the demand for iPads would decrease when the price of the substitutes decrease. This causes a surplus as the quantity supplied is more than the quantity demanded. When there is a surplus, there is a downward pressure placed on the price as consumers are now less willing to offer higher prices. As the price decreases, the quantity demanded will rise and the quantity supplied falls, thus reducing the surplus. This will continue until the surplus is eliminated at the equilibrium price. iPad faces intensifying competition from Android tablets made by Samsung Electronics Co. Samsung Company worked with complementary firms, Google, to bundle their products. A wider range of cheaper devices bundled with Google features Google Maps may erode the iPad’s market dominance. Samsung’s tablet prices are more competitive as it is a closer substitute with iPad, its prices lowered with its services sold in bundles.
 * __Changes due to abnormal circumstances __
 * __Rise in consumer’s income bringing rise to demand of normal goods comparative to inferior goods__
 * __Change in prices of substitutes__

Generally, there will either be an increase or a decrease in the price of iPads.
 * Increase in price of iPads, there is a tendency where people may change over to substitutes of iPads if iPads are price elastic. To ensure the consumers’ interests, Apple uses methods such as giving away iPad complements, such as iPad accessories. This catches the consumers’ interests, encouraging them to buy the iPad.
 * Decrease in price of iPads, is due to the decrease in quantity demanded for the iPads. This causes a decrease in the quantity of iPads sold. The total revenue of Apple, thus, drastically decreases. To counter this, advertisements are made, showing consumers how iPad is unique, creating an imaginary difference to other products. This will encourage consumers to purchase the iPad, causing the quantity demanded to increase along with the price.

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HWEEMIN : in real life situation, prices of Apple products do not change in prices. Prices of Apple products(including iPad) are constant mot of the time. Hence price of Apple products are not be affected by consumer's actions but rather quantity supplied by producer(ie. Apple) will change in response. Or other measures such as cutting down on cost in order to have maximum profit.

Farah :For the last point of your Project B report, first and second sentence,shouldn't it be the decrease in demand of ipads results in a decrease in equilibrium price and quantity supplied of ipads? Anyways, for the ppt, it would be better if some description or reasons are added to each graph for main factors of pricing decisions so that it would give a clearer picture on what is happening. Nonetheless, job well done :)

AMANDA YONG: Project A - For the related products, I think complements should also be included along with substitutes, because they are after all related to the iPad. Complements of the iPad can include iPad covers, apps, iTunes. Project B - We have to take note that the producers will most probably not change the prices of the iPad, let alone reducing the price. If there is an increase in its price, it might be due to inflation or an increase in cost of production. In addition, I think more elaboration can be done on the price elasticities of demand. Project C - Maybe you can be more lively and engaging? :) Thank You! :D