The answer would be that there are few other places to purchase soda on campus; competition (or lack thereof) can play a big factor in determining price elasticity.
While nutrition information can shift consumers' preferences, we have no indication within the question of whether or not the students are well-informed of the impact of their drinking choices.
As for the third option, we are not given any information on the students' budgets, and no information with which to infer this, either. We only have information on their spending as it is related to soda, not as compared to other purchases.
Finally, given that the quantity sold does not change much despite the change in price, we can conclude that this price curve is relatively inelastic, in which case the price elasticity of demand would be closer to zero than one. This effectively rules out the last answer.
Answer:
Explanation:
Calculation of total loss:
Net loss 320,000
Preferred dividend [5000*8%*100] 40,000
Total loss 360,000
Calculation of shares:
Common shares 250,000
Additional common stock [36,000*7/12] 21,000
Total shares 271,000
Loss per share = 360,000/271,000 = $1.328
The available demand and goods
A) The relationship between information systems and organizations is among the fastest-changing aspect of business today.
