Week 3 economic analysis | Complete Solution

Revise your Week 3 economic analysis using the feedback provided by your facilitator to evaluate the challenges of expanding your company's production to a foreign market. This will require you to revise previously recommended pricing and non-pricing strategies for your company's product based on the selected country's economy's stage in the business cycle and the projected economic conditions. Discuss the evidence that supports your recommendations.
Select a foreign market in which to expand your chosen product.
Write a 1,750-word paper (including any material you include from your Week 3 assignment) detailing your findings. The use of tables and/or charts to display economic data over the time period discussed is highly encouraged.

•    Describe current global economic conditions and their effect on local macroeconomic indicators in your selected country. Consider forecasts for population growth, GDP growth, GDP per capita growth, export growth, and sales growth.
•    Evaluate the competitors' existing production in the chosen country.
•    Evaluate forecast sales in the selected country.
•    Determine the type of economy that exists in your selected country - closed, mixed, or market.  What is the difference between these types of economies and how might this affect your expansion?
•    Describe how your chosen country's current credit market conditions affect demand for your product or service and your planning or operating decision for your production in that country.
•    Analyze the role of the selected country's central bank on that country's economy.
•    Evaluate the availability, education, and job skills of the work force in the selected country. Discuss the additional challenges of international production, such as political stability, availability of government financing or other incentives, threat of capital controls, and exchange rate risks.
•    Discuss any additional supply chain challenges you anticipate if attempting to sell your product made in your chosen country to countries outside of that market.
•    Discuss any comparative advantages your company will have over competitors in that country.
•    Recommend either for or against expanding your company's production into your chosen country based on your research.
Cite a minimum of three peer reviewed sources not including the textbook.

Market Structure and Pricing Power
Venclextra is a new product, which has been introduced into the pharmaceutical industry after the FDA approval.  It is critical to understand the implications of Venclexta, which is critical in supporting the operations and success of the product.  Venclexta is a drug which seeks to help in the treatment of patients with Leukemia.  The Venclexta tablets were highly marketable to increase the treatment and access of the drugs in the markets.  Therefore, the paper will seek to examine and analyze the economic factors which relates to and impacts the success of Venclexta in the market.
The market structure of Venclexta is the oligopoly because only a few firms exist within the market.  It is both important and appropriate to analyze and improve the structures and content of the oligopoly market.  An oligopoly is an effective market structure, when the market has many firms, it would be highly concentrated (Aust, 2015).  This could cause small firms to operate within the industry.  For example, fewer competitors would understand the implications of market pricing.  The oligopolies could be identified to rely on concentration programs, which evaluate the level of total market share controlled by fewer firms.
High concentration of firms could identify the industry as an oligopoly.  Some of the key features of oligopoly market structure include interdependence.  This implies that the firm within the market structure depends on their close rivals to make important decisions for the business.  Like monopolies, the oligopolies have high levels of barriers to enter to assist the companies in maintaining a dominant market position, which makes it difficult for new firms to enter the industry (Etro, 2015).  Some of the natural entry barriers of oligopoly include control of the main resources, economies of scale, and high cost of investments.
The elasticity of demand of Venclexta is inelastic, however, the pricing changes impact the nature of quantity demanded within the organization.  The quality range of Venclexta is critical in supporting the nature and implications of the responsiveness to prices due to the changes in the quantity demand.  For example, the elasticity of demand for the product can be assumed 0.7, which influences the products of Venclexta level, in return are impacted on the price levels.
Pricing has a significant impact on the nature and implications of the elasticity of demand among the competing models and programs of the new drug.  The prices charged on the new drug will affect how quantity of new drugs changes with time.  The elasticity of demand of the new drugs is inelastic indicating that the consumers are not highly sensitive to the changes in the prices.  Thus, the pricing of the new drugs will adjust the overall demand for the expansion of the products.
The demand for the new drugs will remain even if the producers and the companies increase the pricing.  However, it is important to determine the optimum level to charge for the new products to avoid adverse effects of the quantity demanded.  The elasticity of demand defines the responsive changes in the quantity of products demanded by the consumers following the changes in the pricing.  The pricing of the new drugs would influence the demand for the products to support the nature of the pharmaceutical industry.
The changes in pricing decisions are important in affecting the nature and implications adjustments in the quantity supplied.  The pricing decisions influence the nature of the company’s marginal cost, marginal revenues, and the market share as the production volume increases.  If the pricing of the new drug is high, it would increase the costs of marginal costs and reduce the marginal revenues as the increased prices of the drug lowers the revenues, which could be made by the pharmaceutical company (Etro, 2015).  In spite of all, the pharmaceutical company will be able to increase the overall market share, which could be gained from the new drugs.  The new drugs will be able to access the niche market for the important drug to support the pharmaceutical company.
If one producer changes the price of the new drugs, the other producers of the drugs will also be influenced to change their pricing.  The changes in the pricing of the product, new drugs will always have significant impact on the nature of pricing the new drugs.  Even though the new drugs are essential, the changes in the prices of the drugs will influence the production volumes and the ability to gain market share.  It is important to adjust the nature of the pricing decisions, which supports the nature of the production volumes and reactions.
In terms of the pharmaceutical industry, there exists different production differentiation and segmentation strategies, which influence the legitimate marketing strategies.  In changing, the appearance of the new drugs will make it more likable and credible in the judgment of consumers.  It is necessary to identify different product differentiation alternatives, which could make the products more admirable to compare to offerings from other competitors.
In terms of market segmentation strategy, the new drugs are effective in targeting a common market in the industry.  The identification of the homogenous market segments such as patients aged 30 years and above (Fitzgerald & Haller, 2014).  The market segmentation strategy will be based on the responsiveness to the marketing basis, which seeks to provide a good market for the new drugs.  The responsiveness to marketing seeks to ensure the producer understands the consumer segment with the highest level of medical needs to be supplied with the drug.
The alternative non-pricing strategies, which can be used, include the low cost and advertising strategies.  Low cost strategy to the pharmaceutical producers will make it more affordable to the various customers who might have a strong need for the product.  In most occasions, the patient might be sick, but the cannot afford the different pharmaceutical drugs, which are offered by the producers (Hollensen, 2015).  Thus, the company can decide to reduce the prices of the pharmaceutical drugs to attract more patients in need and deserving of the drug.
Advertising is another important strategy which influences the access and the marketing of the new drugs.  It is necessary to inform the customers about the existence of the new drugs.  Advertising such as TV commercials will be able to inform a large share of consumers about the product within pharmaceutical offerings.  Therefore, the alternative non-pricing strategies, which could be used, include the low cost approach and the advertising strategies.
In terms of increasing the barriers to entry, the company can seek exclusive rights and provisions, which would prevent other producers from supplying the products.  Having the exclusive rights gives the company a huge advantage to create a barrier in limiting and supporting the pricing strategy (Hollensen, S. (2015). For example, the company could increase the prices and still make huge sales of the drug due to the ability to have advantages, which creates increased barriers for entry into the market.  Therefore, having an exclusive right to sell and distribute the new drugs to the patients will be an alternative non-pricing strategy to create a barrier for the entry in the pharmaceutical industry.
In supporting the pricing strategy, the producers should alter the mix of the fixed and variable costs to improve the overall pricing of products.  Currently, the fixed costs per unit is $10 and the variable costs per unit is $17.  The fixed costs of the new drugs will be lowered while adjusting and managing the variable costs and their efficiencies and effectiveness.  It is important to come with relevant and appropriate strategies to mix the fixed and variable expenses to improve relevant pricing within the pharmaceutical industries (Aust, 2015).  Thus, it is necessary to implement the management, integration of fixed, and variable costs within the company.
The mix of the variable and fixed expenses is appropriate in the understanding and supporting the nature of operating leverage to control the pricing through sales volumes.  When the company has high fixed costs, the changes in the profits will be in the changes in the sales volume compared to the changes in the sales.  It is appropriate to control and adjust the variable costs to expand the overall operating profits in the organization (Anania & Scoppola, 2014).  The measurement of the mix between the fixed and variable costs, which helps with adjustment to the sales volume.  This implies the importance of adjusting the fixed and variable costs within the company offering new drugs.

References
Anania, G., & Scoppola, M. (2014). Modeling trade policies under alternative market structures.    Journal of Policy Modeling, 36(1), 185-206.
Aust, G. (2015).  Vertical cooperative advertising and pricing decisions in a manufacturer-retailer supply chain: a game-theoretic approach. In Vertical Cooperative Advertising in Supply Chain Management (pp. 65-99). Springer International Publishing.
Etro, F. (2015). Endogenous market structures and international trade: theory and evidence. The Scandinavian Journal of Economics, 117(3), 918-956.
Fitzgerald, D., & Haller, S. (2014). Pricing-to-market: evidence from plant-level prices. The Review of Economic Studies, 81(2), 761-786.
Hollensen, S. (2015). Marketing management: A relationship approach. London: Pearson Education.