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Anita’s First Three Months at BEEPL: Elasticity Experiences?

CASELET, MANAGERIAL ECONOMICS
ET Cases, 6 pages

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Anita’s First Three Months at BEEPL: Elasticity Experiences?

 

Anita Chauhan (Anita) was an ambitious girl from a remote village, 15 kilometers from Gorakhpur, in Uttar Pradesh. Anita’s village was sparsely populated and was underdeveloped. For instance, it was not connected by a pucca road, lacked electricity and had just one primary school. Anita completed her schooling from Gorakhpur and graduation (engineering) from Lucknow. Thereafter, she pursued her MBA from the New Delhi Management College (NDMC).

In the fourth semester of her MBA, Anita was placed as a management trainee in the corporate office of Blue Earth Engineering Products Ltd. (BEEPL), located in Udyog Vihar, Sector-18, Gurgaon. BEEPL being one of the leading engineering and manufacturing companies of India, it was a dream company for Anita. She was one of the five students who were offered final placement by the engineering giant. The job profile too was exciting with equally encouraging pay package. The first three months of her work life reminded her of what her Economics Professor had taught in the elasticity session of Business Economics course.........

Teaching Note Preview

Anita’s First Three Months at BEEPL: Elasticity Experiences?

 

Synopsis

This caselet helps understand concepts in elasticity of demand through the experiences of Anita Chauhan (Anita), the protagonist of the caselet. As Anita embarks on a new phase in her life where she joins Blue Earth Engineering Products Ltd. (BEEPL) as a management trainee, she experiences episodes of elasticity of demand. As she takes decisions related to elasticity of demand, the students/participants get an opportunity to understand the concepts of price elasticity of demand, income elasticity of demand and cross elasticity of demand.

Prerequisite Conceptual Understanding

  • • Paul A Samuelson, et al., “Supply and Demand: Elasticity and Applications”, Economics, 19th Edition, McGraw Hill Education (India) Private Limited, 2010 – To have an understanding of the concepts in elasticity of demand

 

Case Positioning and Setting

This caselet can be used for:

  • • MBA Program in Managerial Economics course – To understand the concept of elasticities of demand and its various types and applications

 

Suggested Viewing

  • • Confessions of a Shopaholic, directed by P.J. Hogan, Touchstone Pictures and Jerry Bruckheimer Films, February 13th 2009

 

Assignment Questions

  • I. Explain Anita’s residence selection and shopping for fashion apparel online with the help of concept and types of price elasticity of demand.
  • II. Anita’s first salary undoubtedly changed her brand preferences. How do you categorize the new found demand for preferred brands of shampoo and lipstick? Explain with the help of the concept and types of Income Elasticity.
  • III. ...................


Preamble to this Caselet Analysis

This caselet provides ample scope to learn the three types of elasticity of demand along with the sub-types in each of the three types of elasticity of demand [Exhibit (TN)-I].......

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Abstract


This caselet is meant to understand three types of elasticity of demand - Price, Income and Cross Elasticity of Demand. Presented through a management trainee, Anita's first three months at her new job, this caselet presents several of her elasticity-related experiences. While her residence selection explains the price elasticity of demand, her changed brand preferences reflect the income elasticity of demand and her decision to purchase a two-wheeler highlights the cross elasticity of demand. Each of these episodes can be used to discuss and debate on the concept and contours of each of the three types of elasticity of demand. While each of the three types of elasticity of demand has sub-types, this caselet can also be used to examine the revenue relationships based on the elasticity type.



Pedagogical Objectives

  • To understand the concept and types of Price Elasticity of Demand and discuss on the implications of price elasticity for marketers, consumers and the government
  • To examine three types of Income Elasticity of Demand and discuss on the implications of those from the standpoint of marketers
  • To discuss and debate on the concept of Cross Elasticity of Demand and analyze the relationship between substitutes and complements

Case Positioning and Setting

This caselet can be used for:

  • MBA Program in Managerial Economics course – To understand the concept of elasticity of demand and its various types and applications




This Case Pack Includes:
- Abstract
- Caselet
- Teaching Note (**ONLY for Academicians)
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