Product Report Microeconomics Assignment - Coca Cola

Added on - 24 Mar 2021

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20212021Microeconomics: Product Report
11. Choose a Product and a TrendBefore you begin, choose a product to study. Specifically, make sure to choose a product that is aconsumer good. Keep in mind that goods are tangible products. For example, soft drinks,clothing, cars, and electronics are all types of consumer goods.Product: Coca-ColaA soft drink, like Coca-Cola carbonated beverage refers to anon-alcoholic beverage whichusually consists of liquid, a sweetener, as well as a flavoring agent(Wang, 2008)For the product you’ve chosen, consider economic trends (real or hypothetical) that might impactthis product. You should come up with at least two: one for supply and one for demand. Someexamples that you may use:A change in preferences due to a fashion or health trendA shift in demographics due to aging populationsAn increase or decrease in the input costs (such as cost of raw materials or labor) neededto offer a productNote: Although research is not required for this step, it is encouraged. See the SupportingMaterials section of this project for some recommended databases.Trend 1:Factor that affect demand for Coca-Cola is:A change in consumer tastes or preferencesCustomer preferences may shift because of many of factors, like consumer demographic age,social patterns, seasonal trends and economic volatility.Will an individual purchase acommodity if it is deemed desirable? Consumers are attracted by effective ads as well aspositioning. Coca-Cola has a strong market equity and a strong personal connection with itscustomers. Coca-Cola motto is "Open Pleasure," has effectively established the company as aworldwide symbol of joy. These connections are critical in persuading a customer to purchasea product.The health issues also cause to change consumer preferences as Consumers are concerned
2regarding theingredients of Coca-Cola because they become more awareabouthealth-related problems like increased blood pressure, overweight, as well as diabetes(Andersson et al., 2006).Trend 2:Factor that affect supply of Coca-ColaAdvanced technologyAutomation has contributed to a reduction in production costs. Suppliers can supply more at alower cost as a result of process optimization techniques(Beggs, 2019). Coca-Cola actuallyraised a capability of its bottling plants by implementing Siemens technology. Which meansthat the plants' capacity has improved dramatically, lowering production costs. Means that anyadvancement in Coca- Cola's production technique processes lowers the manufacturing costs,allowing suppliers to supply more goodsPlease note that, while this section is not checked for mastery, it is needed as the basis for therest of your project.2. Determinants of Supply and DemandFor each economic trend you consider, describe it according to the determinants of supply anddemand. Use the determinants from the following list:Demand:Income, prices of related products, preferences, demographic characteristics,buyer expectationsSupply:Prices of factors of production, technology, returns from alternative activities,the number of sellers, seller expectations, natural eventsDemand determinant:Changes in consumer preferencesDemand is influenced by the product's taste as well as preferencethat affects a buyer's decisionto select Coca-Cola over other consumer products. If a customer enjoys a flavor of Coca cola,he or she would choose to prefer the samecommodity over others as even the price of Coca-Colarises. But at the other side, If a customer dislikes the flavor of Coke,he or she is likely toturn to another brand(Paracha et al., 2012).
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