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Economic Analysis of Apple Inc

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ECO320-65: CAPSTONE
Economic Analysis of Apple Inc
Student 2
Cleary University
May 14, 2007
ECO320-65: CAPSTONE
Economic Analysis of Apple Inc.
Introduction 3
Industry analysis 4 Personal computers 4 Computer software 5 iPod and iTunes 5
Company analysis 7 Apple Computers Inc 7 Apple Inc 8
Innovation 9
Profitability 9
Recommendations 11 Personal computing 11
Conclusions 12
References 13
Appendix 14

Introduction

The primary purpose of this report is to execute an economic analysis on Apple Inc. We will review the impacts that the competitive market has had on Apple, since it was founded in 1976. This report will detail how Apple Inc. is both a dire example of the adverse effects of monopolistic competition on a company as other companies into the market; as well as an exceptional example the economic rewards yielded by innovation and brand differentiation within a competitive market. An analysis of Apple Inc would be incomplete without reviewing its past and present competitors. Reviewing these competitors will help the reviewer gain insight into comparative advantages held by other companies and the economic impact this has had on Apple Inc. this report will review the industry as a whole in order to understand the impacts of industry level supply and demand upon Apple Inc. The report will briefly examine the impact of market prices and international trade as an aspect of this report. More importantly, it will review specialization is undertaken by Apple Inc and the economic benefits gained by this course of action. Essentially, the economic view of Apple Inc is looking a company set within the market structure of monopolistic competition and how it has successfully used innovation and branding to turn itself into a pseudo-oligopoly despite competitors continually entering the market.

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