Every firm or manufacture’s main goal is to maximize profit, quality
product, employee well-being, etc. Taking into consideration the marketing and
pricing of the product. (David Makovah, 2018, p. 69)
No matter how much Mercedes sell or don’t, they still need to pay their
fixed cost i.e. Salary, land etc. According to David Makovah (2018), he
explained that fixed costs are cost that remains constant regardless of the
volume of the product or service that you sell. If the sale of Mercedes goes up,
so do variable cost and vice versa. David Makovah (2018) emphasized that
variable cost are cost of production that vary as output changes.
If the buyer is buying a C200 she/he would still be enjoying the benefits
of economies of scale because he will still be driving Mercedes-Benzes hence taking
a C200 which is R581, 206.00 and E200 which is R835, 606.00 (Mercedes-Benz,
Selling more C Classes will benefit Mercedes-Benz in profit maximizing,
the lower the price the higher the demand of C200.
South Africa is the rich country with masses of commodities that it can
use instead of importing them to other countries, and buying them again from
those countries. For example platinum and gold South Africa is the source of
these commodities and they are not using their skills to make more money with them.
The reasons why SA’s manufacturing industries are declining are:
Lack of demand
in the economy for manufactured goods in recent yearsLack of stable
electricity supply has seen SA firms manufacture less due to unstable
electricity gridIncreased imports
of manufacture goods from other countries
What can South Africa do to compete with other countries i.e. China? (Cherlyn-Anne
Africa to benefit from other countries especially China it need to modernize
its manufacturing industry.It must change
or create ways of not importing their natural resources to China in order to
create jobs and see its economic growth thrive.