Business Case Study
Analyzing Supply and Demand in Mrs. Acres Homemade Pies
Looking at individual case studies helps develop a strong business sense. For example, by looking at the options Shelly Acres has concerning her pie making company can help explain larger notions about the theory of supply and demand, and how principles within that theory can help create strategic business decisions. As Shelly finds herself unable to meet demands of her product, she is faced with three options: expanding the facilities without raising prices, contracting production to an external source, or to maintain current production levels and raise prices. Out of all three, the smartest move is to raise prices until the supply equates demand.
Shelly Acres made a business out of selling her grandmother’s infamous home made pies. The original family recipe proved to be incredibly popular and profitable for Shelly Acres and her newly established company Mrs. Acres Homemade Pies.
“The company produces specialty pies and sells them in local supermarkets,” (Hirt
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