Business Essentials (Essay Sample)

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Business Essentials
A case study on prescribing a dose of competitive medicine
In the case, it is determined that prescriptions of drugs are basically the same irrespective of the supplier. In such a case, the market has a self-determined equilibrium price and quantity whereby the supply and demand are equal. The competition that may exist is necessary in keeping the price in constant check. However, it is only based on differentiation whereby one of the pharmacies raises its prices only and only if additional services are offered.
It makes sense only if the additional services offered on the product differentiate the product enough to make the customers to be willing to pay extra amounts. Although this strategy may work, the pharmacist should know that in this market, if he increases the prices highly, other suppliers will know and find their way into the market and compete for the market share as well.
The limited resources that are available in our economic system require choice and preferences for the customers, but require competition for the firms. Through engagement in collusion, the owners of pharmacies are exercising unfairness in the market operation. Business ethics involve making the right decision in the market. Unfair business operation is typically unethical, considering that many people prescribe drugs that have health significance. Unfortunately, this exercise would not last for long since through colluding, the pharmaceutical owners would be making even the weakest individual in the town to pay excessive prices.
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