Current Market Conditions

Current Market Conditions of Apple

Shaleka McClelland

ECO/365

June 10, 2013

Tarron Khemraj

Current Market Conditions of Apple

“With a market capitalization of $559 billion, Apple is the most valuable company in the entire world.”(Carlson, 2012). Apple is a company that focuses on digital music. They use iTunes to make much of their profits. The company gets 30 plus percent of every transaction on itunes. Apple Inc. is considered an oligopoly because it is part of technology sector and personal computer industry, and it is dominated by a few other companies. Apple is controlling the music industry with almost no competition. The Macs are laptop and computers that compete with Dell and HP. Apple products are iPods, iPads, Mac laptops, iPhones and the digital music world of itunes. There are no competitors that can keep up with Apple in the digital music industry because they constantly improve their products and still maintain their low prices.

Productivity and Cost Structure

Apple spends a lot of money on designing and developing their products, including the hardware, operating system and software applications. Apple pays a modest hourly wage, and no commission, to employees who have college degrees. Undergraduate students learn that, in a competitive market, wages are equal to the marginal value product of labor, that is, the dollar value of what the marginal worker produces. Apple as any other company throughout the world has the same basic cost structure. Apple is a very dominant company in the electronics media industry. Apple has buying power that enables them to garnish the lowest possible prices for a service. This allows the company to keep the largest share of income for themselves and the lowest possible share for the workers. The true winners in this company are the shareholders. The company has a 401 K , health care benefits as do...