Business Economics Increasing Business Revenue

Question: Describe about the Business Economics for Increasing Business Revenue. Answer: Introduction In order to increase profit with the help of increasing revenue, commands higher prices through successful branding. On the other hand, when the sales price as well as the number of sales stays constant it is imperative to lower the prices. Analysis The decision related to the rising and lowering of price is a tough one. However, both increasing and lowering of prices involves effectively careful attention to timing. Lowering prices leads to increase in revenue however under the following condition: Revenue will also increase if the demand curve is perfectly inelastic Figure: Perfectly Inelastic (Source: Created by Author) Lowering prices will help to capture market share that will lead to increase in supply Selling the commodity at a price lower than the competitors entails an individual to purchase the product at the lower price. Low prices can fright away high-end shoppers (Brogaard, Hendershott Riordan, 2014). The condition under which the decision is taken to raise the price of a productin order to achieve your goal of increased revenue are as follows: If the product that is sold has inelastic demand, then the price will lead to increase in revenue (Boustan et al., 2013). The quantity supplied of a particular commodity increases in the market with the increase in price. This is mostly because, suppliers will have an increased interest in the production of goods in order to create higher amounts of revenue. Countries mostly trade with each other when they are not able to satisfy their own demands or wants. However, a country that can produce all goods more efficiently than any other country has no need to engage in trade. All the countries are not equally endowed with natural resources as well as other facilities that will help them to produce all the commodities. However, the country that can produce all the goods efficiently is endowed with all the natural resources. On the other hand, there are few countries that concentrate on the manufacture of things that can be produced by them more efficiently. Countries mostly trade to acquire things that are of better quality as well as less expensive. However, countries that can produce everything efficiently do not require less expensive or better quality goods. These countries do not require to become wealthier and as a result they does not require to get engaged in trade. However, to some extent these countries should also get a little eng aged to trade because if they rely heavily on a single commodity that will prove susceptible to market forces (Ossa, 2015). Conclusion It can be concluded that all the countries are not equally endowed with natural resources as well as other facilities that will help them to produce all the commodities. It can as be concluded that low prices can fright away high-end shoppers. References Boustan, L., Ferreira, F., Winkler, H., Zolt, E. M. (2013). The effect of rising income inequality on taxation and public expenditures: Evidence from US municipalities and school districts, 19702000. Review of Economics and Statistics, 95(4), 1291-1302. Brogaard, J., Hendershott, T., Riordan, R. (2014). High-frequency trading and price discovery. Review of Financial Studies, 27(8), 2267-2306. Ossa, R. (2015). Why trade matters after all. Journal of International Economics, 97(2), 266-277