Internet Browser Market

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QUESTION
Module learning outcomes being assessed
1. Appreciate the global nature of business
2. Show understanding of the economic basis for business
3. Demonstrate an understanding of the markets within which a business operates
4. Identify the impact of Government policy on business
5. Show awareness of current issues and their impact on the strategy, behaviour and management of business through working as a group
analyse the internet browser market and should answer the questions below. Each question states the mark allocation, indicating the importance of each question
1. You should do a 100 word introduction to your project. (2% of marks)
2. Outline the change in market shares by the major internet browser in either the UK or the European Union (EU) over the last 5 to10 years. Analyse the structure of the UK or EU browser market. To do this, you should;
• identify the main companies involved and their market shares.
• explain what type of market structure exists, with supporting evidence.
• explain, using economic diagrams, how price, output and abnormal profits are determined by a typical firm (ie: one browser company) which is operating in the market. (Note that your market will be imperfect competition, not perfect competition. Thus, you cannot use supply and demand diagrams in this question).
(25% of marks)
3. What are ‘barriers to entry’, and which ones do you think are significant in this case? Explain your answer referring to your answer in question 2.
(15% of marks)
4. a) With reference to economic theory (diagrams) explain why there is a need for Competition Policy in countries that make up the European Union (EU), rather than allowing free markets to operate.
b). Explain why the EU investigated both Microsoft and Google, and comment on the outcome of these investigations. Assess the impact on Microsoft’s market share.
(25% of marks)
5. (a) On a chart, show what has happened to the UK pound (sterling) against the US dollar between January 2007 and December 2014.
(b) Using a supply and demand diagram, explain this change in the pound’s exchange rate
How might this change in the pound’s exchange rate affect the price of hi-tech products imported into the UK from the USA?
(c) Many producers of hi-tech electrical products faced a fall in sales during the 2008-09 recession following the credit crunch. Using economic theory (diagrams), explain the causes and consequences of the credit crunch.
(25% of marks)
6. As part of your conclusion, assess the future of the browser market.
(3% of marks)

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