Microeconomics Analysis: Coopers Ale, Fosters, and Lion Nathan Beer

This report presents a microeconomic analysis of three prominent beer brands in the Australian market: Coopers Ale, Fosters Beer, and Lion Nathan. The analysis examines the current market conditions for each brand, focusing on the factors influencing demand and supply. The report explores the impact of price changes on demand, highlighting how increased prices can shift the demand curve to the left. Additionally, it discusses the concept of equilibrium and its importance in the market. The price elasticity of demand for each brand is assessed, with a focus on the inelastic nature of the demand. Furthermore, the report evaluates the market structure of Coopers Beer, identifying it as a perfect competition and its competition with Coca-Cola Amatil Company. The analysis also references relevant economic concepts from chapters 6 and 8, and the report provides a framework for understanding the current microeconomic landscape of the Australian beer market, considering demand, supply, and market structure.

Running Head: MICROECONOMICS ANALYSIS
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Microeconomics Analysis
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MICROECONOMICS ANALYSIS
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Microeconomics Analysis
One of the high-quality brands is coopersAle. The current microeconomics condition of
the coopersAle indicates that its demand is increasing exponentially in the market. The supply
for coopers Ale brand is also increasing at a high rate due to continuous production. Another
essential brand is fostering beer. The demand for fosters beer is increasing due to high quality
(Jiang, Livingston, Room and Callinan, 2016 p. 228). The Lion Nathan beer is another brand.
The current conditions for this brand show that the demand and supply increases in the market.
The prices of Lion Nathan beer are fair, and the customers are willing to buy.
The demand for the three brands has been affected by price. If the prices increase, the
quantity demanded decreases. An increase in price for the three brands will, therefore, shift the
demand curve to the left. The reason is that increase in price will lower the customers’
willingness to buy. An increase in price will increase the supply of the three brands in the market
an increase in price shifts the supply curve to the right and vice versa. The concept of
equilibrium should be exercised in the market for the customers to buy the products comfortably.
The price elasticity demand for the cooper’s Ale seems to be inelastic (Jiang et al., 2016).
The same scenario applies to the foster’s and Lion Nathan beer due to high productivity.
The current market structure of the coopers' beer is perfect competition. The company competes
with Coca-Cola Amatil Company (Azevedo and Gottlieb, 2017 p.67). To remain in the market,
coopers beer sets fair prices to the customers. The demand and supply of the three brands in the
market will stabilize.

MICROECONOMICS ANALYSIS
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Figure 1: Showing price elasticity demand for alcohol products
Sourece:https://www.economicsonline.co.uk/How%20markets%20work%20graphs/Minimum-
price_for_alcohol(inelastic).png

MICROECONOMICS ANALYSIS
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References
Azevedo, E.M. and Gottlieb, D., 2017. Perfect competition in markets with adverse
selection. Journal of Econometrica, 85(1), pp.67-105.
Jiang, H., Livingston, M., Room, R. and Callinan, S., 2016. Price elasticity of on-and off-
premises demand for alcoholic drinks: A Tobit analysis. Journal of Drug and alcohol
dependence, 163, pp.222-228.