Business and Its Environment Homework Help

Business and Its Environment

Question 1: Natural Monopolies
There is not a single industry in the economy that can completely fulfill the different conditions for perfect competition. Market imperfections is a common phenomenon that affects virtually all the transactions in the economy through generation of additional costs that often interferes with ‘smooth’ operations of businesses (Taylor, 2007). Most of the firms are concerned with increased profitability level, but with existence of market imperfections, such cannot be realized with ease. However, understanding the costs attributed to the transactions the business undertakes can provide a sure way of reducing or minimizing the cost outlay in the long run. Currently, that is not a big problem affecting businesses as strategic measures have been in place to mitigate its effect. The main problem in the economy is the natural monopolies, and the effects on the profitability level of institutions.
In natural monopoly, the fixed costs are normally high for capital goods, and it affects the profitability level for new entrants into the markets (Hütcher, 2011). The reason for the industry being a monopoly is attributed to ‘natural’ aspects in the economy that prevents new firms from competing with the single established firm in the economy. Natural monopolies are manifested in different forms including utilities such as natural gas, electricity, and water. Indeed it would be quite expensive to develop numerous sets of sewerage pipes and water supply when the current one is still operational. The high fixed cost attributed to the gas and water delivery, can affect the profitability level of an organization.
The economy requires that deregulation of some of the utilities as it would minimize the cost incurred by the government. Although some of the services such as electricity have been deregulated by providing substitute products for generating electricity such as generators, the wires that are used for carrying electricity are always a natural monopoly. The government has provided a regulation and guideline for pricing these services, and they are allowed to have certain percentage of profit margin above the cost incurred. This has ensured that the operations are regulated and the society accesses the basic commodities that would have, otherwise, been inaccessible when these utilities are left in a competitive economy.
Question 2: Antitrust laws and Agencies
Most of the economies are concerned with the way the market is characterized either competitive or monopoly. With antitrust laws, the intention is to promote and preserve free competition in the economy. There are four basic acts of antitrust laws; Sherman Act, Clayton Act, Robinson-Patman Act, and Federal Trade Commission Act. In the case of Sherman Act, it is divided into different sections having different regulations (Jacobson and American Bar Association, 2007). The Act has been used by court to make the conduct of commercial firms unlawful. The rule is used to make some of the practices to be unreasonable and illegal. Clayton Act aims at creating monopoly or lessening competition in the economy. Robinson-Patman Act was enacted with an aim of dealing with price discrimination to products that are charged by competing purchasers in terms of quality assessment and quantity. Finally, Federal Trade Commission Act is mandated to prevent the use of unfair methods by business entity in a competitive economy. As such, it aims at minimizes adverse treatment of consumers.
The antitrust laws are enforced in United States by two agencies; the Antitrust Division of the United State’s Department of Justice (DOJ) and the Federal Trade Commission (FTC) (Hylton, 2010). The mandate of FTC is to issue orders to violators on where to cease or desist from their operations. The work of the DOJ is to ensure that it litigates against these charges on violators. Private parties are allowed to bring civil suits to the Courts. For instance, in the case where Sherman Act is violated, the felonies will be charged a fine of approximately $10 million for organizations (Jacobson and American Bar Association, 2007). The Federal Act provides these two agencies with the opportunity to ensure that the violators are fined or imprisoned.
However, these agencies have the limits towards their mandates. Some of the operations are engaged in reasonable competition and unreasonable conduct of the firm. The agencies are limited to determining whether the competitive aspect of the firms is reasonable or unreasonable. The intention is to ensure that the operations undertaken are legal; however, with the courts have failed to apply different rules on different situation, and they perceive corporate competition to be unreasonable and illegal. The process if quite complicated and it can be simplified through using specific factor such as qualities, past conduct, or goods and services available in the market to determine the legality of operations.
Ten Strategic Points
Title
Streb, C. K. (2008). Empirical research on aging workforce management, Dissertation, Jacobs Center on Lifelong Learning and Institutional Development
Trutsch, B. R. (2003). Managing Virtual project teams. (Masters) San Francisco State University
Mbonyane, B. L. (2006). An Exploration of factors that lead to failure of small businesses in the Kagiso township,College of economic and management sciences
Ntonga, S. (2007). The impact of talent management practices on business performance. Gordon Institute of Business Science, University of Pretoria
Problem Statement
Streb (2008) argues that the society is losing knowledgeable individuals in the form of retirees, and there is need to safeguard the society against challenges through developing measures that manage and transfer knowledge to other members of the society.
Trutsch (2003) purports that virtual team have a strong business justification, and there is need to determine the challenges and current practices of managing virtual project teams.
Mbonyane (2006) understands the unemployment level of Kagiso people, and majority of them have relied on small scale businesses. However, they are not flourishing and there is need to ascertain the reason for failure of these businesses.
Ntonga (2007) argues that talent management is critical across the globe and there is need to determine the impact of talent management in the organization.
Purpose Statement
Streb (2008) purpose is to determine the impact of aging workforce on organizational stability
Trutsch (2003) purpose is to investigate how communication and collaboration issues impact the way virtual project teams are managed.
Mbonyane (2006) purpose is to assess the factors that cause high failure rate of small businesses in Kagiso.
Ntonga (2007) purpose is to assess the perceived impact of talent management, and different perceptions across the organization.
Population/Sample
Streb’s (2008) sample population consists of 10 different industrial backgrounds including human resource consulting, mail order, high tech, power, insurance, waste management, food &beverages, aviation, steel, and automotive. Only 19 companies will be selected.
Trutsch (2003) has not outlined distinct population size or sample that the researcher used.
Mbonyane (2006) relies on population of Kagiso and uses cluster sampling technique.
Ntonga (2007) targeted company X as its population of study, and a non-probability convenience sample was used for data collection.
Research Questions and/or Hypothesis
Streb (2008) research questions;
• What impact does aging workforce have on the organization?
• What are the measures developed in managing and transferring knowledge?
Trutsch (2003) research question include;
• How are the communication and collaboration issues impacting the way virtual project teams are managed?
Mbonyane (2006) research questions are;
• What factors lead to the failure of small businesses in Kagiso?
• What are the guidelines to be developed for small business owners in order to promote success?
Ntonga (2007) research questions are;
• Does the characteristic of individuals affect organization’s talent management?
• What are the experiences of different groups in the organization?
• What are the past behaviours of the employees?
Variables or Phenomena
Streb (2008) main variables include aging workforce symptoms, competitiveness, and measures aspiring competitiveness. Trutsch (2003) variables include collaboration issues and communication. Mbonyane (2006) main variables include organizational functioning, cultural phenomena, social movements, and interactions. Ntonga (2007) utilizes numerous variables including past behaviour, the characteristics of the target population, and their experiences.
Methodology
Streb (2008) utilizes grounded theory of both qualitative and quantitative data while Trutsch (2003) employs both qualitative and quantitative methodology. Mbonyane (2006) utilizes inductive method. Ntonga (2007) methodology comprised both the quantitative and qualitative research methods. Quantitative methods were based on survey questionnaires while qualitative was on face-to-face interviews.
Research Design
Both Streb (2003) and Trutsch (2003) use qualitative and quantitative research design. Mbonyane (2006) study uses exploratory, descriptive and qualitative research as it provides an insight on the research problem and identifies the factors that lead to the failure of small businesses.
The research design deployed by Ntonga (2007) is descriptive and qualitative one.
Data Collection
Both Streb (2003) and Trutsch (2003) use interviews, observations and questionnaires in collecting data. The same case is on both Mbonyane (2006) and Tonga (2007) as they use the same methods of data collection that includes interviews, observations and questionnaires.
Data Analysis
Streb (2003) makes use of qualitative data analysis and grounded theory while Trutsch (2003) also uses qualitative and quantitative data analysis of grounded theory. Mbonyane (2006) utilizes qualitative method of grounded theory while Ntonga (2007 articulates both qualitative and quantitative data analysis.

References
Hütcher, P. (2011). Theory of Natural Monopoly, London: GRIN Verlag
Hylton, K. N. (2010). Antitrust Law and Economics. Cheltenham: Edward Elgar Pub.
Jacobson, J. M., & American Bar Association. (2007). Antitrust law developments (sixth). Chicago, Ill: Section of Antitrust Law, ABA.
Mbonyane, B. L. (2006). An Exploration of factors that lead to failure of small businesses in the Kagiso township,College of economic and management sciences
Ntonga, S. (2007). The impact of talent management practices on business performance. Gordon Institute of Business Science, University of Pretoria
Streb, C. K. (2008). Empirical research on aging workforce management, Dissertation, Jacobs Center on Lifelong Learning and Institutional Development
Taylor, J. B. (2007). Economics. Boston, Mass. [u.a.: Houghton Mifflin.
Trutsch, B. R. (2003). Managing Virtual project teams. (Masters) San Francisco State University