Question

Selecting amazon as a company.

Describe what the firm does, its primary inputs, and its base of consumers (buyers); definethe market the firm operates in;

Analyze the demand for the firm's product(s);

Evaluate the factors affecting the firm's production costs and supply decisions;

Explain the behavior of the firm within the market structure it operates in;

Recognize any market imperfections and identify the role that government may play in addressing those imperfections;

Drawing on all the above, comment and render an opinion (based on your economic analysis) on any major policy issues confronting the firm.

Answer 1

Amazon.com started as a website that sold books. Today, it is a company that operates in e-commerce space with specializations in logistics, data storage, hardware, payments, and media.
It is the go-to site for both - shoppers as well as merchants.

It has become a modern necessity.
Another feature of the website, Prime, its signature $99 per year membership program, has already gathered 85 million subscribers in the US itself, which is equivalent to nearly two-thirds of America's households.

Its costs and supply decisions are affected by the following:
Amazon allows almost anyone to sell almost anything on its platform. One can find almost anything that they need, whether it is a straight sales of merchandise (sold directly by Amazon), or it is the old books which are now shipped from a large warehouse. Further, since 2000, one can find goods sold by third-party vendors - which can be individuals, or small companies and/ or retailers. One can also find used, refurbished and auctioned goods. Hence, the customer needs define their warehouse capacities, which affect their costs and operations. Further, Amazon is a technology driven firm. Hence, it needs to keep innovating in that field. This it efficiently achieves, but the changing trend in technology defines its costs.

Further, any government regulation that prohibits certain goods or allows only restricted use of e-commerce websites would directly impact Amazon's business.