Firms in the computer industry set their pricing based on what their competitor is doing. Go to Price Strategy Simulator at http://forio.com/simulation/pricing/ to try the pricing game “HP/Compaq vs. Dell.” Assume HP/Compaq and Dell is the only firms in the industry.

Answer the following questions:

1. What pricing strategy did you use? Looking at the financials, below what price would you shut down?

2. What was each firm’s cumulative loss/gain and market share after 6 months?

3. What pricing strategy did your competitor appear to use?

4. Select “Create your own Scenario” to find the assumptions in the model.

Assuming the cost structure remained the same, which firm is likely to gain more market share in the long run? Why?

What are some of the differences that exist between corporate taxation and individual taxation? Why do you believe these differences exist?

What are the reporting requirements for corporations? What forms must they file?