Business Finance Homework Help

Discussion post 1:After reading the article and watching the video, based on the data provided, Boeing is both labor and capital-intensive in my opinion.Labor intensive: This term is generally used when a company needs a large work in order to deliver its products (Scott, 2020). Based on the article and the video, we can definitely understand that Boeing had a lot of workforces that worked on different projects to build air crafts. With a large workforce also comes a lot of management, budgeting, and labor issues. Boeing had a lot of clients and huge orders to deliver. In order to meet their client’s demands and expectations, Boeing hires a lot of workforces. Thus, making them Labor intensive.Capital intensive: This term implies mainly to companies or businesses that would usually require a huge investment or money in order to produce the products or goods or services (Mansa, 2021). We are aware that the Airplane industry is one of the most expensive businesses and requires huge capital and a lot of equipment, skilled labor, and high capital for investment. As seen in the video, the Boeing plant was huge with a lot of machinery and assets (Chui, 2018). Boeing is definitely capital intensive. Therefore, I feel that Boeing is both Labor and capital-intensive.Network effect: The term in economics is a phenomenon where a large number of people or consumers enhance the importance of the service or product (Mcguigan et al., 2014). In this case study article and video, we have seen that Boeing had a log internal issues, creating a lot of news. They had production issues and they ignored to reveal it to the public, they had a lot of assurances to the investors but had a lot of concerns within the company, Due to bad financial management they required bailing out from the 777-airplane line (Holmes & France, 2002). They also had a dispute over the program accounting. Taking all these into consideration, I think this had spoilt the reputation of the company.  After so many years from the incident, Boeing is now trying to have better management and be more transparent to the investors. In recent times, I definitely see a network effect being established on their product most of their planes are globally accepted and used. They have recently made new deals with Southwest airlines; they are trying to enter into space exploration and are building new and advanced airplanes.

discussion post 2:One of the most important considerations for the production managers is to optimize the capital vs labor in producing a desired output of production. After reviewing the article “Boeing’s secret and watching the video “ How a boing 787 Dreamliner is Built”, in my opinion, Boeing is capital intensive. A capital-intensive production is one that heavily on machines to produce goods and services which costs the company a substantial amount of financial resources to acquire more assets (Maverick, 2020). Whereas, Labor intensive refers to a production process where labor costs are the largest component. And that capital investment is a small percentage of the final cost (Kenton, 2020). In labor-intensive techniques, businesses can only increase production by asking workers to work extra hours or employ more temporary staff for a specified period. From the article, “Boeing’s Secret”, though the workers toiled round the clock, the production was more dependent on the capital.The network effect is an exception to the law of diminishing marginal returns whereby increased numbers of elements in the products improve the value of a good or service (McGuigan et al., 2017 p. 67). From the article, it was evident that the production system of the company was a failure and struggled due to outdated production techniques. The video describes how the production is optimized by establishing an assembly line in eight stages and also outsourced the subassembly prior to the final assembly. The reputation that was lost overdue to the program accounting was restored by starting to provide the investors supplemental information regarding the quarterly earnings thus gaining their trust.