MICROECONOMICS MIDTERM ASSIGNMENT

PROGRAM: VNU
Due: Thur, May 8th 2025, by 5PM
Weight: 30%
Word limit: 3,000 words (± 10%), excluding references, tables, and footnotes. Word limit must be strictly
adhered to. If your report exceeds the word limit, the excessive word count is not evaluated.
Students are required to form teams of 7-8 students. Each team submits their assignment report and the
group-work report (the template can be found in the appendix of this assignment brief). Each team submits
ONE report only. Students must include the group-work report on the second page of the team assignment
report (after the cover page)

Overview
You will form teams of 7–8 members to act as a business consulting group. Your task is to provide a cost-
volume-profit analysis, prepare budgets, and analyze a macroeconomic shock scenario for a real-world
listed company.
Public companies can be classified into various industries based on the nature of their business operations.
Here are some common industries in which public companies operate:
0. Technology: This industry includes companies involved in software development, hardware
manufacturing, telecommunications, internet services, and electronic devices.
1. Healthcare and Pharmaceuticals: This industry includes companies engaged in medical
services, pharmaceutical manufacturing, biotechnology, healthcare equipment, and
healthcare providers.
2. Energy and Utilities: This industry encompasses companies involved in the production,
distribution, and supply of energy resources, such as oil and gas companies, electric utilities,
renewable energy companies, and water utilities.
3. Manufacturing and Industrial: This industry includes companies involved in
manufacturing processes, such as automotive manufacturing, aerospace, machinery,
chemicals, and industrial equipment.
4. Transportation and Logistics: This industry comprises companies engaged in
transportation services, including airlines, shipping companies, logistics providers, railroads,
and trucking companies.
 5. Real Estate and Construction: This industry includes companies involved in real estate
development, property management, construction, and engineering services.
6. Entertainment and Media: This industry encompasses companies engaged in media
production, broadcasting, publishing, film production, music, television, and online
streaming services.
The industry of your selected business is assigned to you randomly. You use the last 2 digits of your student
ID, then divide it by 7 and get the remainder. The remainder is the number of the business type assigned to
you above. For example, you have the last 2 digits in your student IDs are 24. Divide 24 by 7, and you get
the remainder which is 3. Manufacturing and Industrial is the assigned industry for you. If you need help
to find out the remainder, you can use the function MOD in MS Excel.

Question 1: Introduction (2 marks)

Write a brief introduction of the chosen company and the product/service it provides. Highlight one
representative product (or a group of closely related products) that is significant to the business, and
explain why it is chosen for analysis.

Question 2: Cost-Volume-Profit (CVP) Analysis (3 marks)

Using the selected product (or product group), you will perform a cost-volume-profit analysis for the
selected company using financial data from the latest year available.
Note:
o Complete the CVP analysis using real-world figures from the financial statement.
o Justify and clearly explain any assumptions made (e.g., unit price, variable costs, fixed costs,
etc.). This should be clearly mentioned in your team report.
o Apply knowledge from the chapter on Firm Production to support your calculations and
assumptions.
Some additional key metrics to consider:
𝑐𝑜𝑛𝑡𝑟𝑖𝑏𝑢𝑡𝑖𝑜𝑛 𝑚𝑎𝑟𝑔𝑖𝑛 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 = 𝑠𝑒𝑙𝑙𝑖𝑛𝑔 𝑝𝑟𝑖𝑐𝑒 − 𝑣𝑎𝑟𝑖𝑎𝑏𝑙𝑒 𝑐𝑜𝑠𝑡
𝑠𝑎𝑙𝑒𝑠 𝑐𝑜𝑛𝑡𝑟𝑖𝑏𝑢𝑡𝑖𝑜𝑛 𝑚𝑎𝑟𝑔𝑖𝑛 𝑓𝑖𝑥𝑒𝑑
𝑝𝑟𝑜𝑓𝑖𝑡 = ( × )−
𝑣𝑜𝑙𝑢𝑚𝑒 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 𝑐𝑜𝑠𝑡𝑠
You are expected to provide a complete table showing the CVP analysis results. This can be provided in a
separate excel spreadsheet, but screenshots are encouraged in your report. Also, you are required to provide
commentary on the results.
Question 3: Revenue, Cost, and Profit Budgets (3 marks)
Using the most recent quarterly report as your base period, your team is required to prepare revenue, cost,
and profit budgets for the upcoming four quarters. Your projections should reflect realistic and well-
justified expectations for the company’s short-term financial performance, based on publicly available
information and reasonable economic forecasts.
Each number included in your budget must be accompanied by a clear explanation of the assumption behind
it. For example, if you expect labor costs to increase, state the percentage change you assume (e.g., a 1.5%
increase in labor cost) and cite the source (such as national inflation data or industry-specific wage growth
reports). Similarly, if you project an increase or decrease in sales volume, provide a rationale supported by
economic indicators, consumer demand trends, or company guidance. Use credible sources such as
financial statements, industry outlooks, central bank reports, or international institutions like the IMF or
World Bank. All points must be discussed clearly and comprehensively in your team report.
Budgets can be provided in a separate excel spreadsheet, but screenshots are encouraged in your report.
Your team must also write a brief commentary analyzing the overall financial condition of the business.

Question 4: Scenario Analysis – Impact of an International Trade War (2 marks)

Imagine that an international trade war erupts. Tariffs and trade barriers are imposed that affect your chosen
industry. Consider how this event might affect revenue, cost, and profit. Revise your budgets based on this
scenario. What strategic responses should the business consider.

References should be in APA style.

 GROUP-WORK REPORT

Please write the names of all of your group members, including yourself, and evaluate the degree
to which each member fulfilled his/her responsibilities for completing the group assessment report.
They must be submitted together with the group assessment. You are encouraged to approach
group members who are not meeting the desired group expectations. (You may also approach
your lecturer if group member(s) refused to respond/communicate.) The possible ratings are as
follows:

Excellent (5) Consistently did what he/she was supposed to do, very well prepared and
cooperative.
Very Good (4) Usually did what he/she was supposed to do, acceptably prepared and
cooperative.
Good (3) Often did what he/she was supposed to do, minimally prepared and
cooperative.
Borderline (2) Sometimes failed to show up or contribute to group planning/report and
discussions.
Lacking (1) Consistently failed to show up or contribute to group planning/report and
discussions.
No Contribution (0) No participation at all.

NOTES:
These rating should reflect each individual's level of participation, effort, and sense of
responsibility, not his or her academic ability.
Group members with legitimate excuses for missing participation/meetings can make up his/her
missed contribution by contributing more to other tasks.
It is up to the group to determine a fair process. Rating is as follow:

5 marks-no deductions
4 marks-10% deduction
3 marks-20% deduction
2 marks-40% deduction
1 mark-60% deduction
0 mark-no contribution, no marks,

Name Rating Explanation