Econs Webquest 2011

1. EconsWebquest 2011 Ryan Celine Athallah Wey Jieh Benedict

2. When did the iPad first originated? It was first launched in the United States on 3 April 2010. It was a product from the company named Apple, which was founded by Steve Jobs.

3. How is the price of iPad determined? The price of the iPad is usually affected by its supply and demand for it. However, there are many other factors affecting it, such as income of consumers, availability of close substitutes, and many more. During a shortage of iPads, the price of iPads increase as the demand for iPads exceeds the supply required. The converse is true, ceteris paribus. Also, the price of an iPad is determined by the consumers who signal how much they are willing to pay for their product, and also the producers, who determine which is the best price for maximum profits.

4. What are some of the related/associated products for iPad? How are these products related to the iPad? Some related products are laptops, macbooks and applications. Laptops, macbooks and iPads are similar in function, and are close substitutes. Thus, the cross elasticity of demand should be a large positive value. Also, since they are substitutes, consumers may choose to buy the product that suits them most. For the applications, since they go along with iPads, they are close complements and the cross elasticity of demand should be a large negative value.

5. How would recent developments affect marketing and pricing decisions for the iPad? A double digit economic growth has marked a new record growth in Singapore, showing that our market has recovered from the previous economic crisis. Income of consumers have gone up extensively from 2009. The higher the income of consumers, the more dollar votes they can cast. Consumers will also be more willing and able to pay for normal goods and luxury goods instead of inferior goods. Ipads will be classified as a luxurious good. Hence, prices for the product can be adjusted higher to widen the profit margin for Apple. On the other hand, if consumers’ incomes are lower, lesser dollar votes can be cast for luxurious products like these. Producers will then have to reduce prices to entice consumers to purchase their goods as consumers are highly likely to switch to inferior goods in this scenario. Advertising strategies of Apple would also have to change to portray the Ipad as a necessary good instead of a luxury.

6. How would recent developments affect marketing and pricing decisions for the iPad? Also, if changes in the prices of goods related to Ipadswere to be adjusted, the marketing and pricing decisions of Apple would also be different, especially if the products are close substitutes to Ipadslike laptops, netbooks. Example, if prices of Acer laptops were to be reduced, consumers would prefer that cheaper buy as to paying for an Ipadthat has almost the same functions. Hence, the marketing strategies of Apple would have to compete with their substitutes in terms of pricing as well, instead of functions, novelty and quality that Ipads are known for.

7. How would recent developments affect marketing and pricing decisions for the iPad? With rising technology, consumers have higher expectations of digital products. Ipadshave to reach the ever-increasing expectations of consumers in order to be purchased. Apple thus has to constantly upgrade their Ipadsand come up with new versions with more functions to stay relevant and at the top of the technological era. Example, the Ipad 2, being more slim and compact than the first version of the Ipad, it fulfills the consumer’s criteria of convenience and consumers that previously found the Ipad bulky would now be more willing to consider purchasing the Ipad. Once the Ipad reaches the expectations of the consumers, they would be more willing to cast their dollar votes to this product for its novelty.

8. How would recent developments affect marketing and pricing decisions for the iPad? Rewards and incentives that governments give out, example to companies that manage to invent new products, would entice companies to push themselves and attempt at doing so. Furthermore, these new inventions would attract the purchasers and increase their profits. With many companies vying to compete, the country’s economy would improve steadily with the high level of competitiveness. Hence, this would help consolidate the position of the Ipadif Apple is willing to constantly improve on this product and update functions constantly. However, if the governments worldwide were to impose heavy taxes on such digital goods that are imported for protectionism, this would decrease the profit margin of Apple. Hence, Apple would consider changing a marketing strategy to maybe selling only in their own country to avoid foreign taxes or marking up prices to protect their profits.

9. The End! 