Saturday, September 22, 2018

Economic concepts related to PepsiCo


PepsiCo
PepsiCo products are enjoyed by consumers one billion times a day in more than 200 countries and territories around the world.

Economic Concepts related to PepsiCo

1.Law of Demand: When price of the Pepsi increases people consumes less quantity and when there is a decrease in Price they will consume more a quantity.

2.Economies of Scope: PepsiCo not only gets benefits from economies of scale but also from economies of scope. It is a play in a market when a company grows by diversifying the scope of production, by reducing the risk of the business by competing the different sectors of markets.

3.Marginal rate of substitution: As Pepsi and Coco Cola are substitute goods. People will substitute Pepsi with Coco Cola when there is increase in the price of the Pepsi.

4.Incentives: Incentive is what make people to respond towards a product. Pepsi provides different offers and cashback when it is purchased through different mediums.

5.Oligopoly: Pepsi belongs to oligopoly market. It is a market where there are only limited suppliers for same product in the market. Along with Pepsi there are Coco Cola, Thumbs up, Fanta, Minute maid etc.



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