Week 6: Final Business Proposal
John A. Acosta
ECO/ 561
April 23, 2014
Dan Olsen
Week 6: Final Business Proposal
Introduction
Thomas Money Service Inc. has been in business since 1940 and has grown in the market as a finance industry. The company started off with financing small loans for household needs and increased throughout the years to financing business equipment in 1946 with a subsidiary name Future Growth Inc. (FGI), where it gained a huge market share with rapid speed. This business proposal will benefit the company because it is in a time frame where there is a high demand for equipment.
Their move in 1946 to branch out into equipment financing moved them forward into the right direction. They saw that after World War II, everyone was coming home from the war. As people were coming home, new businesses were booming in construction and forestry and equipment were needed in these businesses. In 1951 the organization made a daring move to purchase a manufacturing company, giving them an advantage in the market of selling their equipment and financing it and eventually just selling their own equipment instead of other brands. For over 60 years, Thomas Money Service Inc. has increased profits year after year.
Increase Revenue / Profit –Maximizing Quantity
In order for Thomas Money Service Inc. to reach their optimum point, they need to know where their marginal cost and marginal revenue meet. Once they know where that point is, it can lead to maximum profit. “In order to determine the profit maximizing level of output, the monopolist will need to supplement its information about market demand and prices with data on its costs of production for different levels of output.” (Cliff's Notes, 2013) Identifying this is crucial for their growth, especially in today’s economy, where the demand for their product is low.
With their strong history of profits in the construction industry, they have survived throughout the years. Though...