In the Fall Semester,Alex Noticed That the Plastic Cola Bottles

question 42

Multiple Choice

In the fall semester,Alex noticed that the plastic cola bottles in the vending machines at his university had changed shape.Upon further investigation,he realized that each bottle contained 2 ounces less beverage than previous bottles,even though he paid the same price as last semester.The pricing objective of the beverage company is to:

• A)Increase profits by reducing the amount provided in each bottle.
• B)Build traffic at the vending machines by changing the shape of the bottle.
• C)Undercut the competition by changing the shape of the bottle.
• D)Increase market share by reducing the amount provided in each bottle.

---

Definitions:

Beta

A measure of a stock's volatility in relation to the overall market, indicating the stock's sensitivity to market movements.

Risk-Free Rate

A hypothetical interest rate associated with an absolutely risk-free investment, typically exemplified by government securities.

Market Portfolio

A theoretical bundle of investments that includes all available assets in the market, with each asset weighted according to its market capitalization.

Risk-Free Rate

The expected profit from an investment that carries no risk of losing money, frequently depicted through the interest rate of government bonds.