Imagine you are an analyst for a major car manufacturer.You need to consider whether the company should attempt to expand its car line into a new space: sporty cars aimed at the active lifestyle consumer.

Currently there are 2 other major car manufacturers making this type of car.You think that your company can develop, design, and produce the car for an average cost of $25,000 per car.Right now, in the market, the average price of this type of car is $35,000.

Thinking about the market structure, then analyze and explain whether the company should enter the sporty car segment of the market.You should make any assumptions explicit and consider the market structure of the car industry as well as the potential response of competitors.Drawing some diagrams of models and graph you feel will help explain your ideas, be sure to explain all economic concepts clearly.

Here are the economic concepts of Microeconomics you may use to analyze and explain.

Monopoly, Oligopoly, and Monopolistic Competition. Setting Prices When You Have Market Power. The Problem with Market Power.

Revenues, Costs, and Economic Profits. Long run. Barriers to Entry.

Measuring Economic Surplus. Market Efficiency. Market Failure and Deadweight Loss.

Price Discrimination. Group Pricing. The Hurdle Method.

Your analysis and explaination can't be brief, you should make it particular, detailed.

Thank you so much.