This project will be developed in four parts. Each part will have some submission due each week according to the schedule below. While none but the final will be graded separately, failure to submit any part on time will be reflected negatively in the grade:
• Part 1 (by the end of Week 3) will have students assigned to a group, which will meet regularly and stay in touch using the cyber space and brainstorm a strategy;
• Part 2 (Week 4) the group will submit a breakdown of who is researching what, who is responsible for what in the packaging of the information, and a list of their research sources. Instructor will provide ungraded feedback.
• Part 3 (week 5) the group will submit a draft of their information, but not their recommendations (ungraded, but with feedback).
• Part 4 (week 6) the group will submit their final package, including their recommendation about which company to invest in, incorporating feedback from Parts 2-3.
Overall, your group will study the case study selected, and then conduct additional research on the companies in order to get information to address the following questions.
a) What is the price elasticity of demand for gasoline? Is it elastic or inelastic? How about carbonated beverages?
b) What is the Income Elasticity of demand for Coke and Exxon gasoline your selected two companies? Which one has the higher elasticity?
c) What is the cross price elasticity of demand between Coke and Pepsi or your selected two companies? Between Exxon gas and Shell gas?
d) What is the Cross Price Elasticity between Coke and Exxon gasoline your selected two companies?
e) What other issues with regards to the social, political, labour or environmental practices of these two companies might you include that could impact your decision?
2. Remember that your ultimate goal is two-fold:
o to provide the best evidence to support the choice of one company over the other as a place to invest; and
o to do so in the most compelling, informative and creative way you can.
These solutions may offer step-by-step problem-solving explanations or good writing examples that include modern styles of formatting and construction of bibliographies out of text citations and references. Students may use these solutions for personal skill-building and practice. Unethical use is strictly forbidden.The two companies – Coca-Cola and Exxon Mobiles are two largest companies in the world in their own industries. While Coca cola is a major player in the beverages or soft-drinks industry which has over 500 brands of non-alcoholic beverages all over the industry. Similarly ExxonMobil is the largest petroleum and petrochemical enterprise in the world. During the end of 2016, ExxonMobil had a market valuation of USD 374 billion and more than 71 thousand employees were there in ExxonMobil by the year 2016. The company is made up of three divisions namely upstream, downstream and chemical. Upstream is the most important division of ExxonMobil and is involved in the exploration and extraction of petroleum products. It comprises of around 2.5% of the total net income of the country. The production output in this division was about 3.4 million barrels per day(Statista, 2017b).
Similarly Coca-Cola is also a major player in the beverages industry. It is a billion dollar brand and it is also one of the most valuable brands in 2017 having the brand value that amounts to 69.73 billion USD. This company is headquartered at Atlanta, GA and has about 300 bottling partners all around the world. The company has an net operating revenue of 41.86 billion USD in the year 2016. The Coca-cola company has four leading brands of carbonated soft drinks namely coca-cola, diet-coke, Fanta and Sprite(Statista, 2017a).
This paper identifies the market structures in which the two companies are working, their various elasticities namely price elasticity of demand, income elasticity of demand, cross-price elasticity with related products and other environmental factors that might affect the working nature of these two companies - ExxonMobil and Coca-Cola and make recommendations about the company that would prove to be a better investment option.
Market Structures of Coca-Cola and ExxonMobil:
Coca-Cola in Oligopolistic market structure:
Coca Cola company operates...
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