MNE3701 Assignment 4
(COMPLETE ANSWERS)
Semester 2 2024 - DUE 11
October 2024
CONTACT:
, MNE3701 Assignment 4 (COMPLETE ANSWERS)
Semester 2 2024 - DUE 11 October 2024
Having acquired sufficient knowledge and skills on
financial management for small business, you must
demonstrate practical competencies in constructing
financial statements and in conducting feasible financial
forecasting. As a new entrepreneur understanding
financial management and accounting, forms an integral
part of running your small business. In addition, you
should also be able to forecast the financial outcomes
that could result from your decision. The projections of
business’s profits, its assets and financial requirements,
and its cash flows are essential in determining whether
your business is economically viable. Having acquired
sufficient knowledge and skills on entrepreneurship and
small business management, you must demonstrate
practical competencies in applying a pricing system and
promotional planning. Think of any business you would
like to start and answer the following questions:
QUESTION 1 By using practical examples, critically
discuss how you would applying a pricing system in your
business. (10)
When starting a business, applying an effective pricing system is crucial to ensure the company
remains profitable and competitive. Let's consider a practical example of starting a small café
that focuses on selling premium coffee and artisanal baked goods. Here's how I would apply a
pricing system:
1. Cost-Based Pricing:
The first step is to calculate all the costs involved in producing each product. For instance, if
making a cappuccino costs R10 (ingredients, labor, and overheads), I would add a markup to
ensure profitability. A typical markup could be 50%, which means the cappuccino would be
priced at R15. This method ensures that all costs are covered, and a profit margin is secured.
2. Value-Based Pricing:
(COMPLETE ANSWERS)
Semester 2 2024 - DUE 11
October 2024
CONTACT:
, MNE3701 Assignment 4 (COMPLETE ANSWERS)
Semester 2 2024 - DUE 11 October 2024
Having acquired sufficient knowledge and skills on
financial management for small business, you must
demonstrate practical competencies in constructing
financial statements and in conducting feasible financial
forecasting. As a new entrepreneur understanding
financial management and accounting, forms an integral
part of running your small business. In addition, you
should also be able to forecast the financial outcomes
that could result from your decision. The projections of
business’s profits, its assets and financial requirements,
and its cash flows are essential in determining whether
your business is economically viable. Having acquired
sufficient knowledge and skills on entrepreneurship and
small business management, you must demonstrate
practical competencies in applying a pricing system and
promotional planning. Think of any business you would
like to start and answer the following questions:
QUESTION 1 By using practical examples, critically
discuss how you would applying a pricing system in your
business. (10)
When starting a business, applying an effective pricing system is crucial to ensure the company
remains profitable and competitive. Let's consider a practical example of starting a small café
that focuses on selling premium coffee and artisanal baked goods. Here's how I would apply a
pricing system:
1. Cost-Based Pricing:
The first step is to calculate all the costs involved in producing each product. For instance, if
making a cappuccino costs R10 (ingredients, labor, and overheads), I would add a markup to
ensure profitability. A typical markup could be 50%, which means the cappuccino would be
priced at R15. This method ensures that all costs are covered, and a profit margin is secured.
2. Value-Based Pricing:
