AME U2DB Response 1 and 2

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The presentation by Kristy Qawiyy was informative. From the paper, it is evident that both supply and demand are influenced by changes in price. Also, changing the price in one region, the United States, may produce a different impact as that witnessed in South Korea. To bring the point home, the student used examples of products such as water, television, and internet to illustrate the effects. However, one is left wondering why the student used products such as water and TV to demonstrate the elasticity instead of using auto spare parts such as the bonnet, bearings, tires, and car seats.
It would be eminent for the student to clarify the economic reasons for increasing the prices and the effects after that. For example, the student can state that there is higher demand and lower supply of spare parts in the United States when compared South Korea. Moreover, when defining the law of demand and supply, there are factors kept constant (Vargas & Cortés, 2017). It would be interesting to note whether the elements held constant in South Korea are similar to those in the United States.
Sarah ONeal introduces the topic by identifying significant differences between the United States and South Korea. In particular, South Korea has cheaper labor and lower taxes when compared to the United States, and this warrants the increase in price if the manufacturing plant has to be moved to the United States. In essence, understanding the business environment is vital in determining the pricing and the progress of the business (Vargas & Cortés, 2017).

From the presentation, it is clear that a more extensive market can be covered by establishing a website to advertise and facilitate online purchasing.
Apart from taxes and labor what other factors may affect the set prices? Can the number of competitors and availability of substitutes in the market influence pricing? (Vargas & Cortés, 2017). The student must clarify the pricing strategies, especially the online prices. Mostly, online prices are fixed depending on the competitor’s prices; therefore, other factors such as production costs may have a slight effect on pricing.References
Vargas, C. G., & Cortés, M. E. (2017). Automobile spare-parts forecasting: A comparative study of time series methods. International Journal of Automotive and Mechanical Engineering, 14, 3898-3912.