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    Consumer buying power

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    What would be the consumer buying response to Coca-Cola if the price of Pepsi doubled? If the prices of Coca-Cola and Pepsi remained constant, what would be the consumer's typical buying response to these products if their income was reduced by 30%? Suppose all carbonated beverages tripled in price. How would the concepts of utility, income, and substitution predict consumer behavior based on the rise in the cost of carbonated beverages?

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    What would be the consumer buying response to Coca-Cola if the price of Pepsi doubled?

    If the price of Pepsi doubled but the price of Coca-Cola stayed put, the consumer's are likely to buy more of Coca Cola and very little if any of Pepsi. This is the case because Pepsi and Coca cola are identical products.

    If the prices of Coca-Cola and Pepsi remained constant, what would be the consumer's typical buying response to these products ...

    Solution Summary

    What would be the consumer buying response to Coca-Cola if the price of Pepsi doubled? If the prices of Coca-Cola and Pepsi remained constant, what would be the consumer's typical buying response to these products if their income was reduced by 30%? Suppose all carbonated beverages tripled in price. How would the concepts of utility, income, and substitution predict consumer behavior based on the rise in the cost of carbonated beverages?

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