PepsiCo has shown the best current ratio and is able to pay off their debts, which Coca-Cola does not have that and is struggling to pay off their debts. However, Coca-Cola has a higher retained earnings percentage, which means that it is able to have funds available for future growth of the company. The hope for both companies is to provide their financial statement with better information presented over their competitor giving the ability to earn more investors. PepsiCo and Coca-Cola do not need to be at war with each other as they have what it takes to get people to use both products, no matter what. Keep in mind, that it is the people’s choice whether or not to support a company and decide whether to invest in the company not competing against each
1: Tariffs encourage Americans to buy U.S.-made products. (Points: 13) I find this position to be valid. Tariffs are basically taxes on imports, thus making imported goods more expensive to buy (Nickels, McHugh & McHugh, 2008, p. 75). Protective tariffs are designed to raise the retail price of imported products so that domestic goods are more competitively priced (Nickels, McHugh & McHugh, 2008, p. 76). Therefore, if when a consumer enters a store and sees similarly priced products, one imported and one made domestically, they can choose a US made product without feeling as if they are overpaying for the same product.
The increase in sells in the iPhone also led to the increase in sales with the iPad as well. This really solidifies why the record company will not settle for the flat pricing price of Apple policy. Apple ability to control the download of music will definitely not work if Apple doesn’t allow for more flexible pricing. Apple must understand without music to download then there is know extra incentives or revenue that helps them maintain those increases in sales with their iPhones, iPods, or iPads. Apple future with downloads will be just find
The expected present value of potential cash flow is $10.76 if the drug is licensed. However, in this case Merck would discontinue the phase 3 study if the drug passed phase 2 for weight loss only. This is because under this scenario Merck would lose more money to continue phase 3 than not to continue phase 3. Question 5: According to the tree in Exhibit 1, the expected payoff without the information of whether it will pass phase 1 is 13.98. If Merck knows the drug will fail phase 1, it will never incur the 30M cost in phase 1.
If so, is it towards the direction Pepsi favored? Based on the limited information I have from the case, I would not suggest dropping the project abruptly as it might trigger negative sentiments. I would either proceed to fund it for the second year with plans to wrap it up by end of second year, or get the PepsiCo brand team to fund it, involving more brands such as Doritos I could not find any indication from the case regarding why consumers prefer Coca-Cola over Pepsi Cola, despite the successful blind-tasting campaign. If it is not because of the taste, then what really motivates consumers to choose Coca Cola over Pepsi? If Pepsi’s marketing team want to increase sales or market share, they should find out – instead of “blindly” running social good campaigns expecting it to build brand equity.
Answer 1: The effects of 1995 reduced the demand for Apple's products. Thus the competitive reactions shifted Apple's demand curve to the left thereby reducing demand at each price level. The decision to preserve profit margins or cut prices depends on the price elasticity of Apple's products. If Apple's products have an elastic demand (which seems to be the true from the case), then apple should follow suit and cut prices. However, if the demand is inelastic (not likely to be true), then Apple should preserve its profit margins.
One suggestion is that the company reposition its water as a premium product, justifying a higher price. If successful, the company believes that it could charge 20% more for its water than it does now. 1. What is the maximum sales loss (in % and units) that Healthy Spring could tolerate before a 20% price increase would fail to make a positive contribution to its profitability? The maximum sales loss would be 25% before they can tolerate before a 20% price increase, which amount to 1,500 bottles per day instead of 2,000.
As part of Apples iOS system, users are able to take advantage of “free” upgrades (much like a subscription), from time to time, and there is a cost associated with those upgrades which will need to be allocated to the revenues Apple collects from the upfront charge for the phone. Therefore, spreading realized revenues over two years, in this case, will help to smooth out the expense in software upgrades over the 2 year term. The choices are imperfect either way; however, since Apple receives all of the money upfront and incurs expenses over time, the best way to match the expense with the revenues seems better reflected in non-GAAP terms. 2) Should Apple lobby for the non-GAAP numbers to be sanctioned by FASB? It doesn’t seem that lobbying for non-GAAP measure will be of help to Apple.
Is the use of a monthly average price a net advantage or disadvantage to J & L? Using NYMEX contracts will minimize the asset mismatch aspect of basic risk, along with a better liquidity. However, since diesel fuel is not a traded commodity, it cannot be directly hedged and J&L will suffer a certain amount of basis risk. J&L will also need to post a margin for their future contracts at NYMEX. Using product offered by Continental Bank would require a higher cost for J&L, and illiquid compared with NYMEX.
An economist would not make an excuse when the problem at hand is a serious one with detrimental side effects. This is why an economist would assume the best of alcoholism to simplify the process of rectifying it. According to Cook & Moore, authors of the article, The Economics Of Alcohol Abuse And Alcohol-Control Policies, in the journal Health Affairs, the way to fix alcoholism is to raise prices of beverages that contain alcohol because, ”consumers tend to drink less ethanol, and have fewer alcohol-related problems, when alcoholic beverage prices are increased or alcohol availability is restricted.” Another economic solution to fighting alcoholism would be to place tariffs on companies that are involved in the alcohol trade. By doing this, it becomes more expensive to complete business and thus liming supply of the end product. This would be more beneficial in the end in conjunction with raising excise taxes for the consumer; because the alcohol producers will forward the taxes on to the consumer, creating yet an even pricier drink for the consumer.