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Case – 2

In the mid 1990s piracy was endemic. So the game industry responded with “budget games” which were
priced at £1.99, making them hardly worth copying. However, this resulted in very thin operating margin
to the publishers.

  Bruce Everises was  in charge of marketing at a new publisher called Codemasters. The created a
brand  with  ……..
elasticity problems.
  It appears  that Game  pricing  is based on what  the market will  bear and  probably prices are not
optimized for profitability.

Questions:-


1.  Do  you  think  games  in  this  case  present  an  exception  to  law  of  demand  or  not?  Give  logic  in
support of your answer.
2.  On basis of  the  case  can  it be  concluded  that demand  for games was not elastic  to price,  rather
some other variables were important? If yes then identify the other variables.
3.  The case presents an interesting dimension to consumes’ behaviour. Discuss.
 




Case- 4                    

The Industry  

The automotive sector is one of the core industries of the Indian economy, whose prospect is reflective of
the economic  resilience of  the country. The automobile  industry witnessed a growth of 19.35 percent  in
April-July  2006 when  compared  to  April-July  2005.  As  per  Davos  Report  2006,  Indian  is  largest  three
wheeler  market  in  the  world;  2nd
  largest  two  wheeler  market;  4th
  largest  tractor  market;  5th
  largest
commercial  vehicle  market  and  11th
  largest  passenger  car  market  in  the  world  and  expected  to  the
seventh  largest by 2016. India  is among  …….
  transmission  assemblies  for  four  wheeled  vehicles.  The  project  is  being
implemented  in  the  existing  Joint  Venture  Company  viz.  Suzuki  Metal  India  Limited  (renamed  Suzuki
Power train India Limited).

Questions:-


1.  Identify  the most  important  factors of production  in case of automobile  industry. Also attempt  to
explain the relative significance of each of these factors.
2.  What more  information would you  like to obtain  in order to draw a production  function  for Maruti
Udyog? Explain with logic.
3.  Automobile industry is a good example of capital augmenting technical progress. Discuss.