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PRODUCT HISTORY
• The company originally started in Switzerland in 1885, when Julius Maggi took over his ather!s mill"
• Maggi was the #rst to $ring protein%rich legume meals to themarket, and ollowed up with a ready%made soup $ased onlegume meals in 188&
• 'n 1()*, Maggi!s holding company merged with the +estlcompany.
•
+estle is a Swiss company, ounded in 18&& $y -enri +estle"• +estle market its products in 1./ countries across the world"
• Maggi has $een +estl!s 0agship culinary $rand not only in'ndia, $ut glo$ally as well"
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LAW OF DEMAND
2emand or a commodity increases whenits price decreases and alls when its pricesrises other things remaining constant"3
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4oncepts Elasticity 2emand
Two 6aria$les are considered whilemeasuring the elasticity o demand 7% 2emand
2eterminants 2emand
Elasticity 2emand percentage changein 9uantity demanded percentage change indeterminant o demand
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Types Elasticity 2emand
Demand
PriceElasticity
Cross PriceElasticity
Income
Elasticity
AdvertisementElasticity
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:rice Elasticity 2emand
The price elasticity o 2emand may $ede#ned as the ratio o the relative changein demand and price varia$les"
e = percentage;proportional change in9uantity demanded percentage;proportional
change in price
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Types :rice Elasticity
PriceElasticity
PerfectlyElasti
c Perfectly
Inelastic
Relati
velyElasticRelati
velyInelast
ic
Unit
aryElastic
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:erectly Elastic
4onsumers haveinde#nitedemand at a
particular priceand none at allat an evenslightly higherthan this givenprice, demand is:E<=E4T>?
E>@ST'4
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:erectly 'nelastic
Ahen the demandor a commodityshows no responseto a change inprice; whateverchange in price,the demand
remains same, it iscalled :E<=E4T>?E>@ST'4
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<elatively Elastic
Ahen the
proportion ochange in the9uantity
demanded isgreater than thato price, the
demand is said to$e <E>@T'6E>?E>@ST'4
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<elatively 'nelastic
Ahen the
proportion ochange in the9uantity demanded
is less than that oprice the demandis considered to $e
<E>@T'6E>?'+E>@ST'4
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Dnitary Elastic
Ahen theproportion ochange indemand is
eactly the sameas the change inprice, the
demand is said to$e D+'T@<?E>@ST'4
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Measurement :rice Elasticity
MeasurementOf PriceElasticity
Percentage/Proortionate
Met!od
"eometric/Point
Met!odArc Met!od
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:oint;Feometric Method
This methodattempts tomeasure the
priceelasticity odemand at aparticularpoint on
demand
:oint Elasticity >ower segment o demandcurve $elow the point Dpper segment o demandcurve $elow the point
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@rc Elasticity 2emand
@rc Elasticityo 2emandmeasures the
elasticity atthe mid point$etween twopoints on acurve
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'ncome Elasticity 2emand
The income elasticity is de#ned as a ratiopercentage or proportional change in the9uantity demanded to the percentage or
proportional change in income"
'ncome Elasticity percentage changein 9uantity demanded percentage
change in income
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4ross Elasticity 2emand
The cross elasticity o demand reers to thedegree o responsiveness o demand or acommodity to a given change in the price
o some related commodity"
4ross Elasticity 2emand
:roportionate;percentage change indemand or
:roportionate;percentage change in price
o y
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=actors 'n0uencing Elasticity 2emand• +ature o commodity•
@vaila$ility o su$stitutes• +um$er o uses• 4onsumers income• -eight o price and range o price change
• :roportion o ependiture• 2ura$ility o the commodity• -a$it• 4omplementary goods• Time• <ecurrence o demand• :ossi$ility o postponement
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@pplication 'ncome Elasticity
>ong term $usiness planning
Market strategy
-ousing development strategies