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Essay / What is Business Investment
Quamie Lancello M. Feinberg Economics November 30, 2017 Business InvestmentSay no to plagiarism. Get a Custom Essay on “Why Violent Video Games Should Not Be Banned”? Get an Original Essay During a person's lifetime, chances are they will have many opportunities to invest in a business, but how do you know which are the right choices to invest in? Some of the things that investors typically consider when choosing candidates to invest in are the company's operating costs, the company's potential profits, and how the company responds to changes in the business. supply and demand. These elements help investors determine whether a company is a risky investment or a potentially profitable investment. Looking at all of these during my interview, I concluded that investing in Mr. Arius' company 3SixtyDesign would be a good idea. One thing an investor should ask about is operating costs. Operational costs are the ongoing costs necessary for the proper functioning of the business. These costs are different depending on the type of business, there are several different operating costs when budgeting for a business. Some operating costs are fixed, meaning they are almost the same from month to month, for example rent. On the other hand, the rest of the operational costs are considered variable and can fluctuate from month to month, for example utilities. I think this business had a good operating cost since it was able to sustain itself with the profits made and not go into debt. There are 6 different supply changers that can cause goods to increase, decrease, or stop the supply chain. For example, nature is a driver of supply change that can affect the supply chain. Nature can create conditions that make the creation and transportation of goods impossible, for example hurricanes. Another example of a change in supply is war. Wars and other armed conflicts can deprive a country of access to the materials it needs to function. They create uncertainty about the future availability of raw materials, and the risk associated with reduced supply can have a significant impact on prices and demand. Technology is also changing the offering. Technology makes it much easier to increase production. This makes goods cheaper to manufacture, which increases supply. The main factor in changing this company's supply is the season. The company's demand increases in the spring as people want nice homes during the summer. Nature also participates, since this is an architectural firm, if a natural disaster occurs, people will have to repair their homes. Demand is determined by how customers want or need a product. Product prices play an important role in its demand. In some cases cheaper products try to get higher demand and in some cases more expensive products seem to have higher demand because in both cases for some reason people want more substantiated demand . on the price. Another way to determine demand is to determine a company's expectations for a product. If a company expects a product to do good, it also expects demand for that product to be high, vice versa. The company I chose expected their products to perform well in certain seasons, which meant they had a way.