Vermont-Based Green Mountain Coffee Roasters Dominates the Market for Single-Serve

question 41

Multiple Choice

Vermont-based Green Mountain Coffee Roasters dominates the market for single-serve coffee in the United States, with its subsidiary Keurig accounting for approximately 70% of sales ("Rivals Try to Loosen Keurig's Grip on Single-Serve Coffee Market," Chicago Tribune, February 26) . But Keurig's patent on K-cups, the plastic pods used to brew the coffee, is expected to expire this year, allowing other companies to better compete. Suppose a potential competitor has been conducting blind taste tests on its blend and finds that 47% of consumers strongly prefer its French Roast to that of Green Mountain Coffee Roasters. After tweaking its recipe, the competitor conducts a test with 144 tasters, of which 72 prefer its blend. The competitor claims that its new blend is preferred by more than 47% of consumers to Green Mountain Coffee Roasters' French Roast. Which of the following should be used to develop the null and alternative hypotheses to test this claim?

• A) H₀: = 0.50, H_A: ≠ 0.50
• B) H₀: p ≥ 0.47, H_A: p < 0.47
• C) H₀: p ≤ 0.47, H_A: p > 0.47
• D) H₀: μ ≥ 72, H_A: μ < 72

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Definitions:

Sustained Competitive Advantage

An enduring edge over competitors gained by offering consumers greater value, either through lower prices or by providing more benefits that justify higher prices.

Difficult To Imitate

Referring to a unique characteristic or attribute of a product or service that competitors find hard to replicate.

Supplier Power

The ability of providers of goods or services to influence the terms and conditions of supply, affecting market prices and the competitiveness of buyers.

Entry Barriers

Obstacles that make it difficult to enter a particular market, which can include high startup costs, strict regulations, or strong competition.