Suppose the Price of Vanilla Coke Increases by 9% and Quantity

question 68

Essay

Suppose the price of Vanilla Coke increases by 9% and quantity demanded falls by 13% overall but only by 4% for loyal Coca-Cola customers.This means that for the general public there are for Vanilla Coke, but for loyal Coca-Cola customers, Vanilla Coke is more
of item.This means that Coca-Cola will enjoy an increase in total revenue only from
________.
A.several substitutes; a necessity; loyal Coca-Cola customers
B.few substitutes; a luxury; the general public
C.no substitutes; a necessity; the general public
D.several substitutes; a necessity; the general public

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Definitions:

Retail Inventory Method

An accounting method used by retailers to estimate inventory levels by incorporating the cost to retail price ratio.

Sales Discounts

Reductions in the price of goods or services offered to customers, typically as an incentive to encourage prompt payment.

Ending Inventory

The total value of goods available for sale at the end of an accounting period.

Cost-to-Retail Ratio

A method used in retail to calculate the estimated ending inventory value at retail prices by dividing the cost of goods available for sale by the retail price of the goods.