1. Firm Profit More has recently conducted a series of analyses into their productivity by examining its average costs per subscriber and volume of subscribers. The executives are now looking into the best strategy for moving forward. Given the following information, what reasonable conclusions and recommendations would you, as Director of Strategy provide to the Board of Profit More regarding: i)the meaning of the various curves as described below: ii) marketing efforts to double the volume of subscribers and/or expanding the scope of business activities; iii) the quest to gain market share; iv) growth/investment strategy; v) pricing strategy; vi) cost-management strategy (assume they are higher than competitors on scale but lower on the anticipated experience curves); vii) acquisition strategy of competitor. All of the following given factors are accurate and must be incorporated given as of March 1, 2022 :

At 15,000,000 subscribers, the average cost per subscriber was $37 in 2012. At 65,000,000 subscribers, the cost per subscriber is $25 (as of March 1, 2022). The Scale Curve for 2021 had an average slope of .94.

Projections for scale based on a new economies of scope demonstrate a change in the slope to .90

The learning curve based on the original scope has an average slope of .91

The experience curve based on the inclusion of newly anticipated economies of scope demonstrates a slope of only .85. Labour costs are expected to remain the same, but the costs of materials will likely increase because of supply chain issues related to Covid-19. (20 marks)

Answer rating: 100% (QA)

To analyze the information provided and make reasonable conclusions and recommendations we will consider the following factors i Meaning of the curves ... View the full answer