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Market Potential Case Study

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Tutorial Three - Market Potential

Exercise 3 Market Potential Case Study

Question 1

Population characteristics of a country are used to define its market potential. Furthermore, the market size of a country can be indicated through the population size, growth and other distributions according to location. (Cronk, Hill, & Wickramasekara, 2011). Mazuwa has a population of approximately 36 million. When analyzing its ratio of urban to rural population, statistics show that 40% reside urbanely, and the remaining 60%, rural. In terms of operating a business in Mazuwa, it is evident that with more than half of the countries population living in rural areas, the market potential of an international product would be significantly low. This is because, human capital would be low due to the fact that the amount of “educated, mobile and healthy people” would be of a lower percentage as only 40% of the population reside urbanely. (Sessoms, 2013). Therefore the labour force of the country also plays a significant role in terms of the market potential. With less than half of the population residing urbanely, this may indicate individuals who possess adequate qualifications to work for the firm, may also be low. Additionally, in terms of doing business in Mazuwa, the potential firm would primarily be located in or around a CBD location. With less than half of the population being there, market potential would not strive and would consequently cause the business to not do that well.
Therefore, population and factors relating to its demographics and growth plays an important part in the decision making process of doing business internationally.

Another factor that can determine market potential is the measure of GDP. It is defined as the dollar value of the annual production of final goods and services that take place within a nations border, and ultimately

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