Demand is the quantity of goods or services consumers will buy at a particular price‚ at a particular time period. Market demand refers to the sum of individual demand for a good or service. It is assumed that the demand being represented is effective demand- the ability of consumers not just to want‚ but be able to buy the product. Quantity demanded is the inverse function of price‚ however there are other factors which influence the level of demand. Factors influencing individual demand differ
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JOURNAL OF ECONOMIC ISSUES Vol. XLIV No. 4 December 2010 DOI 10.2753/JEI0021-3624440402 Government-Led Export Promotion in Light of Distributional Fairness in the Global Trading System Jai S. Mah Abstract: Since developing countries were relatively free from the trade regulations relating to export promotion policies until 1994‚ the northeast Asian dynamic economies could pursue export promotion policies aggressively during the period of rapid economic growth. Under the current World Trade
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The Measure of a Man And in this way‚ smiling‚ nodding to the music‚ he went another mile or so and pretended that he was not already slowing down‚ that he was not going to turn back‚ that he would be able to drive on like this alone‚ and have the right answer when his wife stood before him in the doorway of his home and asked‚ Where is he? Where is your brother?(Wolff 269) What is the measure of a rich man? Is it his material possessions‚ the extent of his spirituality‚ or is it how he chooses
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market price is and thus‚ it prevents exploitation of the consumers as producers would not be able to charge unfair prices. This is because each firm produces an insignificant fraction of the total market supply and therefore is unable to affect price‚ it is for this reason that each firm in perfect competition is known as a price taker. There are no barriers to entry or exit in a perfectly competitive industry and thus‚ producers can enter or exit the market without any restrictions and thus‚ without
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Harvard Business Review‚ (January 2008)‚ pp. 2-17 Assignment Questions (AQ) (a) Why has the soft drink industry been so profitable for concentrate producers? Compare the economics of the concentrate business to the bottling business: why is the profitability so different? [50% points] The soft drink industry has been extremely profitable for Concentrate producers. When we study the 5 forces analysis‚ we come to a conclusion that almost all the forces have contributed significantly in this massive
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so‚ how much & why? The soft drink industry is very profitable. It is more profitable for the concentrate producers than for the bottlers. Exhibit 3 clearly indicates how much this industry is profitable to the concentrate producer as compared to the bottlers. This industry as a whole generates positive economic profits. The other reason why the soft drink industry is profitable is: * Bottling Network: Coke and Pepsi have agreements with existing bottlers which prevents it from taking on new
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enough to take away significant market share from Coke and Pepsi. Concentrate producers are more profitable than bottlers for many reasons. The concentrate process involves little capital investment whereas the bottling process is capital intensive and involves specialized‚ high-speed lines. Most costs in the concentrate industry are for advertising‚ promotion‚ market research‚ and bottler relations. Concentrate producers invest heavily in trademarks and innovative and sophisticated marketing
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Using your knowledge of industry structure (Porter’s five forces) do an analysis of the industry structure of the concentrate producers… Regarding the industry structure of the concentrate producers‚ the Porter’s five forces varied in each category: Industry Rivalry‚ suppliers‚ buyers‚ substitutes‚ and potential entrants. Of the five forces‚ competition is the highest weight between Pepsi and Coca-Cola. Industry Rivalry • Coca-Cola and Pepsi-Cola claim nearly 75% of the U.S. carbonated soft
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Why is the concentrate business or industry so profitable? Soft drinks concentrate producers gross margins were more than 60% and an average return on assets of 17% between 1990 and 2000. There are many reasons for that: even if a new concentrate plant big enough to provide all the USA would cost less than $50 million‚ it is almost impossible for new investors to get into the soft drink industry ‚ basicly because the existence of high barriers as brand positioning‚ bottling and distribution
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pricing policies‚ in order to face the reduction of the CSD consumption by diversifying the offer‚ conquering the customers’ loyalty and gaining new margins on the selling of concentrates to the bottlers. Despite the mentioned negative trends‚ the soft drink industry remained an attractive industry for both concentrate producers (CP) and bottlers. These two parts of the industry are extremely interdependent‚ sharing costs in procurement‚ production‚ marketing and distribution: so‚ because of operational
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