SOLUTION: ECON 101 Saudi Electronic University Total Cost of Bicycles Discussion

Hey, please go through the following answer document to see if it meets all the criteria. All answers with explanations are included in the document. Answers have been checked for plagiarism, format and grammar. If in case you need any revisions, please let me know :)Question 1.Solution :The total cost of bicycles produced in a day is the sum of the fixed cost and the variablecost.Given that the fixed cost for producing bicycles = $6000 per dayGiven that the variable cost for producing bicycles = $80 per bicycle per daya) Since Average cost (AC) = (Total cost) / (Number of units of good produced),For 30 bicycles,Total cost (TC) = $ (6000 + 30*80) ( Fixed Cost + Total Variable Cost )TC = $ 8400∴ Average cost (30 bicycles) = 8400/30 = $280For 60 bicycles,TC = $ (6000 + 60*80) ( Fixed Cost + Total Variable Cost )TC = $ 10800∴ Average cost (60 bicycles) = 10800/60 = $180For 100 bicycles,TC = $ (6000 + 100*80) ( Fixed Cost + Total Variable Cost )TC = $ 14000∴ Average cost (100 bicycles) = 14000/100 = $140For 300 bicycles,TC = $ (6000 + 300*80) ( Fixed Cost + Total Variable Cost )TC = $ 30000∴ Average cost (300 bicycles) = 30000/300 = $100b)The LRAC (Long Run Average Cost) Curve decreases initially but starts to become flatas the quantity produced increases. Hence, the average costs decrease initially but stabilise as thequantities produced increase.Question 2)Solution :In a market with perfect competition, the price of the commodity is equal to its marginalrevenue (MR). The equilibrium quantity in this market is the quantity at which the marginalrevenue (MR), which is also the price (P), is equal to the marginal cost of production (MC) ofthat commodity.a)Consider the case as drawn in the graph. The equilibrium price P is charged by the firm, which isdecided by the competitive market. This price is also equal to the marginal revenue(MR). Theproduction cost C per unit is decided by the point where the …

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Next to these stages, there are four types of loyalty. The first type is no loyalty: this can be seen as the typical action supporter that is giving money to fundraiser friends/family. There is no connection between the action supporter and War Child, non-loyal customers add a small amount to the financial account of the organization. The second type is inertia loyalty: this type can be a potential Friend, the person is giving a donation because they always have done it. This person is not loyal to one charity because there is no deeper connection and is easy with switching from charity to charity. This person is reachable to get a deeper connection with to become a potential Friend. It is needed to give the potential Friend attention and please the person. The third type is latent loyalty: this type is based on situational influences such as time, social life, physical factors, reasons why to support charity and the mood of the person. Latent loyalty means that there are repeated purchases. The last type is premium loyalty: this is the greatest type an organization can get. This type indicates the loyal Friend who is proud to discover more and tell about War Child to everyone. (Griffin, 2010) Using the stages and types of loyalty, War Child will get a better understanding about their potential Friends. Increased loyalty can give benefits to more respects of the company. Increased loyalty will be cost saving because there will be reduced marketing costs, more positive word-of-mouth, satisfied loyal customers whereby the failure costs decrease. (Griffin, 2010) 1.2.4 Customer relationship management Kotler (2014, p. 9) stated in the book ‘’Principles of marketing’’ that customer relationship management (CRM) can be mentioned as delivering superior customer value and satisfaction by building and maintaining profitable customer relationships. (Kotler, 2014) Using a suitable approach for the action supporters will lead to charitable giving. To build and maintain profitable customer relationships, customer relationship management need to be implemented. It is very important to deliver customer value and make the action supporters satisfied. By doing this,>

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