Answer:
Price inelastic.
Explanation:
Price can be defined as the amount of money that is required to be paid by a buyer (customer) to a seller (producer) in order to acquire goods and services.
In sales and marketing, pricing of products is considered to be an essential element of a business firm's marketing mix because place, promotion and product largely depends on it.
A price elasticity of demand can be defined as a measure of the responsiveness of the quantity of a product demanded with respect to a change in price of the product, all things being equal.
Mathematically, the price elasticity of demand is given by the formula;
The demand for goods is said to be inelastic, when the quantity of goods demanded by consumers with respect to change in price is very small. Thus, the more easily a consumer can switch to a substitute product in relation to change in price, the greater the elasticity of demand.
Generally, consumers would like to buy a product as its price falls or become inexpensive.
In this scenario, the residents of California did not use less water even when the water company raised water prices. Thus, water is price inelastic.
Answer:
A business is any organization where people work together.
Explanation:
- Business is any organization which strives to earn profit through the focusing on a common goal. Business is located such that it is near to the resources needed for its success.
- The business strategy and type of business determine the goals of the business.
- Irrespective of the devised strategy the business must aim to produce a product, service to empower the society.
- The three characteristics to conduct a business include:business must be the product of individuals working in organized way, must help the society, must make some profit.
Michael Porter, Harvard Business School professor said that strategic position means to preserve what distinctive about a company to achieve sustainable competitive advantage.
Strategic positioning helps determine where a business stands against its competitors, consumers, and the market. Companies that are unique and stand out by their customer connections often have a greater change at competitive advantage and a strong strategic positioning.
Answer:
r = 0.16 or 16%
Explanation:
Using the CAPM, we can calculate the required rate of return on a stock. This is the minimum return required by the investors to invest in a stock based on its systematic risk, the market's risk premium and the risk free rate.
The formula for required rate of return under CAPM is,
r = rRF + Beta * (rM - rRF)
Where,
rRF is the risk free rate
rM is the return on market
r = 0.07 + 1.5 * (0.13 - 0.07)
r = 0.16 or 16%
