Economics Webquest A project done by Charlene Wee, Le Ngoc Mai, Seah Qian Yi, Soh Qian Wei, Gan Chin Boon, Huo Yong Hao & Lee Zheng Rong of 11S101

When did the iPad first originate? First tablet PC by Apple: Newton MessagePad 100 Several more Newton-based PDAs, including MessagePad 2100 developed before release of iPad

How is the price of iPad determined? Adam Smith’s ‘Invisible Hand’ Consumer and producer decisions result in a final price where quantity supplied = quantity demanded (Market equilibrium) Rationing and signaling function Determined through demand and supply for iPad

Related/Associated Products with iPad Samsung Galaxy Tab & Motorola Xoom Serve same function and offer similar features Imperfect substitutes

Recent Developments Affecting Marketing and Pricing Decisions for iPad Anti-iPad campaign by Microsoft Introduction of increased numbers of Android tablet computers As imperfect substitutes, they provide consumers with a wider range of products to choose from

Consumer’s Point of View: Increased Competition Presence of more tablet computers increases choice Increases number of substitutes, making iPad more price elastic Signaling function results in drop in price of iPad

Consumer’s Point of View: Microsoft Anti-iPad Campaign Weaknesses of iPad highlighted Results in firms deferring purchase or preferring substitutes over iPad Demand curve shifted to the left Market equilibrium at lower price and quantity due to signaling function

Producer’s Point of View: Increased Competition Apple may improve iPad to increase customer preference Distinguishes iPad from competitors, making substitutes more imperfect Demand for iPad more price inelastic Signaling function would result in increase in price

Producer’s Point of View: Microsoft Anti-iPad Campaign Apple has to address problems to increase customer preference Prices decrease due to drop in demand Signaling function would result in drop in price to market equilibrium to maximise profits

Conclusion Recent developments would affect price at which iPad is now set Through better marketing, the problem can be countered allowing an increase in price to maximise profits