Assignment Description:

Applying Demand Analysis and Elasticity

Write a 1250-1700-word evaluation addressing the following points/questions. Be sure to thoroughly answer all the questions for each bullet point. Separate each section in your paper with a clear heading that allows your professor to know which bullet you are addressing in that section of your paper. Support your ideas with at least three (3) sources in your essay. Make sure to reference the citations using the APA writing style for the essay. The cover and reference pages do not count toward the minimum word amount. Review the rubric criteria for this assignment.

As a manager, consultant, or business leader, understanding how consumer behavior and demand elasticity affect your products or services is critical to making informed decisions about pricing, marketing, and forecasting. For this assignment, you will analyze a real-world product or service from your organization or an industry of interest. Your goal is to evaluate how demand is influenced by various factors and to apply relevant economic toolsincluding elasticity measures, marginal analysis, and regression techniquesto support data-informed decision-making.

1. Product or Service Overview With scholarly references (200-300 words):
   • Describe the product or service you have selected.
   • Provide background on the company or industry context, including market conditions, customer base, and general pricing strategy.
2. Consumer Behavior and Demand Factors With scholarly references (200-300 words):
   • Analyze the main factors influencing consumer demand for this product or service.
   • Consider preferences, income levels, price sensitivity, and availability of substitutes or complements.
   • Reflect on how recent trends (e.g., inflation, economic cycles, and changing consumer preferences) may be affecting demand.
3. Elasticity Analysis With scholarly references (300-400 words):
   • Evaluate the price elasticity of demand for your product or service. Would you consider it elastic, inelastic, or unit elastic?
   • Include a discussion of income elasticity and cross-price elasticity where applicable.
   • Explain how price changes might impact total revenue and how elasticity informs pricing decisions.
4. Marginal Analysis and Revenue Decisions With scholarly references (200-300 words):
   • Apply marginal analysis to assess production or pricing decisions.
   • Discuss the relationship between marginal revenue, elasticity, and output decisions in your chosen context.
   • Explain how you might use this analysis to decide whether to increase or decrease production or change pricing.