Question

Competitive Microeconomic strategies of large enterprises in the context of the “new economy”.

Answer 1

Microeconomics is a branch of economics that deals with the decision of individuals and firms to allocate the available resources of production, exchange and consumption. It deals with the prices and products in a single market and the interaction between different markets. Thus, it provides a more efficient analysis of the economy than the macroeconomic concepts that deals with the extetnal effects in an economy.

In the wake of the new economic strategies, there are many novel strategiea that are being followed by the enterprises to get an advantage in the market. The four major microeconomic strategic methods that are followed in the new econonic world are the cost leadership model, differentiated leadership model and coat focus and differentiated focus model. These are the major stratagies that helps in the proper analysis of the microeconomic strength which can be used up to take the market advantage. The cost leadership approach focus on the mass production methods that would help in implementing low pricing and thus helps in gaining an advantage in the pricing policy. In the differentiated case, product differentiation is focused and hence the pricing methods are not followed as in the previous case. In the cost focus model, the pricing of various products would have a focus and in the differentiated focus approach, product variations are preferred to price fixations and hence competitive approach would have a focus on products.

All the above are the major microeconomic and pricing strategies that could be followed in the new economic model to gain market advantage for large enterprises.