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The Traditional Elements of the Marketing Mix Have Become Irrelevant in the Modern World

In: Business and Management

Submitted By sahasaugata
Words 984
Pages 4
Question 1:
The Municipal Corporation of a small college town decides to regulate rents in order to reduce student living expenses. Suppose the average annual market-clearing rent for a two bedroom apartment had been Rs.10000 per month, and rents were expected to increase to Rs.15000 within a year. The Municipal Corporation limits rents to their current Rs.10000-per-month level. Explain what will happen to the rental price of an apartment after the imposition of rent controls. Do you think this policy will benefit students? Why or why not?
Answer:
If the municipal corporation implements the policy to limit the rent and controls the rent to Rs1000, then it will be very beneficial to most of the students who already have rented the houses, although it will be a negative impact to the owners as they will not get the returns as per the existing price as they would not be allowed to increase the rent. This will be very beneficial for the students living expenses.
However, there is a continuous inflow of students. The new student would not have accommodation available. There will be a shortage of apartments and the demand would be higher and eventually there will be very less apartments available for any new student.
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Hence we can conclude that some students will benefit from the regulation of rent and some students will not benefit and might end up without an accommodation.
Question 2:
Suppose you are the manager of a chain of computer stores. For obvious reasons you have been closely following developments in the computer industry, you have just learned that the government has passed a two-prong program designed to further enhance the computer industry position in the global economy. The legislation provides increased funding for computer education in primary and secondary schools, as well as tax breaks for firms…...

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