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Operation decision

Using the regression results and the other computations from Assignment 1, determine the market structure in which the low-calorie food company operates.

Use the Internet to research two(2) of the leading competitors in the low-calorie microwavable food industry, and take note of their pricing strategies, profitability, and their relationships within the industry (worldwide).


Write a six to eight (6-8) page paper in which you:


1.Outline a plan that will assess the effectiveness of the market structure for the company’s operations.

2.Suppose the business operations have now changed from the market structure specified in the scenario. Determine two (2) likely factors that might have caused the change. Predict the primary manner in which this change would likely impact business operations in the new market environment.

3.Analyze the major short-run and long-run production and cost functions for the low-calorie microwaveable food company. Suggest substantive ways in which the low-calorie food company may use this information in order to make decisions in both the short-run and the long-run.

4.Determine the possible circumstances under which the company should discontinue operations. Suggest key actions that management should take in order to confront these circumstances. Provide a rationale for your response.

5.Suggest one (1) pricing policy that will enable your low-calorie microwavable food company to maximize profits. Provide a rationale for your suggestion.

6.Outline a plan, based on the information provided in the scenario, that the company could use in order to evaluate its financial performance. Consider all the key drivers of performance, such as company profit or loss for both the short term and long term, and the fundamental manner in which each factor influences managerial decisions.

7.Recommend two (2) actions that the company could take in order to improve its profitability and deliver more value to its stakeholders. Outline, in brief, a plan to implement your recommendations.

8.Use at least five (5) quality academic resources in this assignment. Note: Wikipedia does not qualify as an academic resource.

Your assignment must follow these formatting requirements:


•Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.

•Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

The specific course learning outcomes associated with this assignment are:


•Analyze short-run and long-run production and cost functions.

•Apply macroeconomic concepts to changes in global and national economies and how they affect economic growth, inflation, interest rates, and wage rates.

•Evaluate the profit-maximizing price and output level for given operating costs for monopolies and firms in competitive industries.

•Use technology and information resources to research issues in managerial economics and globalization.

•Write clearly and concisely about managerial economics and globalization using proper writing mechanics.

Solution Description

                                                               Operations Decision



 There are many low calorie microwavable food options available in the market today. With the rise in income people can afford an easier lifestyle therefore there has been a change in the cooking style of people. People now use microwaves in place of traditional cooking methods. With rise in microwaves, the rise in food items also occurred. With so many varieties and products available one can easily target upon a healthy choice of microwavable food. A low calorie food or a healthy option of food is one which comprises of  a good source of protein along with  having least 3 grams of fiber (for satiety), in addition to not more than 600 milligrams of sodium. (Zelman, (n.d.))

            Some of the options are manufactured by Lean Cuisine and Healthy Choice. Both of them are the competitors in the market of frozen foods. Lean Cuisine was started in 1981 and has since then grown its market in US, Canada and Australia. The company is owned by Nestle and offers variety of frozen foods and is a leading choice for low calorie food.

          Healthy Choice, the product manufactured by ConAgra is another leading low calorie frozen food supplier. They are the biggest opponents to Lean Cuisine. The market segment is decided by three criteria’s which are Behavioral, Psychographic and Profile variables. 

            Behavioral variables are those that are sought from the product, and buying patterns like frequency and volume of purchase may be considered the fundamental basis.

           Psychographic variables are used when purchasing behavior correlates with the personality or lifestyle of consumers. Consumers who hold varied personalities and lifestyle trends also become prejudiced towards certain products. Their choices are determined by their economic and social standing.

        Profiling is not a very important criteria for market segmentation. After deciding upon the differences the markets also needs to decide upon the channel through which these are exhibited. Profile variables such as socio-economic group or geographic locations are very necessary in deciding the target audience.

       In determining the market structure for food industry, one would firstly keep in mind the target audience. A clear study of the economic growth of the whole food industry is very important. There also needs to be a motive and objective for growth amongst the company itself.

The scale of operation needs to be decided upon i.e, whether the company is going to cater to local market, national or global market.

Economic study of the industry