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Products, Services, and Prices Free Essay, Term Paper and Book Report

Products, Services, and Prices in the Free Market Economy Companies are often faced with the age old question, should the price of a good be increased or decreased to improve revenue? The typical impulse to increase revenues for many companies is to reduce their price and sacrifice margins with the hope of increasing demand and thereby increasing revenue. However, one should first consider the price elasticity of demand (PED) before inadvertently giving up margin and ultimately reducing top line growth. When Team A was given the task to determine the best alternative to improve a Company’s revenues, the team first sought to understand the PED of Coca-Cola product line. The website for Wikipedia encyclopedia (2007) defines PED as an elasticity that measures the nature and degree of relationship between change in quantity demanded of a good and the changes in price. Since the Coca-Cola Company is known world-wide, and Coca-Cola Classic is known as the “world’s beloved soft drink” and has strong brand loyalty, it was chosen as the product in which an analysis of the price ......

Word Count: 1477
Page Count: 5.9  (250 words a page / double spaced)


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