Essays on Diseconomy

Part I

Answer 1 It is a static budget in since the planner had already set the expenses together with the expected revenues. The fees each student was to pay had already been determined and accounted for. Each student was required to pay, the estimated grants to expect and the expenses that would go to salaries, purchase of equipment and other miscellaneous expenses.

Answer 2

The total revenues for the 120 students less grants was 802,567-(50,000+10,000+5,000+10,000) =727,000. Total revenue per student727,000/120=6058.3333. The total revenue less grants for the 100 students was: 681, ...

The article titled “Schumpeterian competition and diseconomy of scope; illustrations from histories of Microsoft and IBM” by the authors Bresnahan, Greenstein and Henderson is a great attempt to address the creative destruction problem that face organizations mostly in industries that are growing first. Therefore, this paper is a reaction to the arguments by the authors with a view on their focus on diseconomy of scope in addressing the possible cause of the creative destruction problem. The paper begins by reviewing the author’s argument and introducing a counter argument that is then supported by a further review of the validity of their arguments as ...

Based on the Timothy Bresnahan, Shane Greenstein, and Rebecca Henderson’s article Schumpeterian Competition and Diseconomies of Scope, the authors suggest that in the past, the incumbent and successful firms fail in new markets due to the strategies they use in these markets. Other suggestions in this article include the fact that the organization frames of these big firms have been unable to flex appropriately for the new era in technology due to their fixed nature. Additionally, it is suggested that, the fear of cannibalization coupled with the underinvestment could also be a source of failure in these incumbent firms. ...