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The structure of the cold drink industry in India is best described as
- a)perfectly competitive.
- b)monopolistic.
- c)monopolistically competitive.
- d)oligopolistic.
Correct answer is option 'D'. Can you explain this answer?
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The structure of the cold drink industry in India is best described as...
The soft drink industry is a type of an oligopoly and an example of the firm is Coca cola Company. The industry is an oligopoly because the firms in this industry produce products that are differentiated. The competition depends on the way the brand of the firms market their products. The firms in the soft drink industry are mutually interdependent and each firm is affected by the actions of the competitors. The sales of Coca Cola Company may end up being affected in case Pepsi changes its product specification or even the price of the product. The competitors often act by changing their advertising, specification and price. There are also barriers to entry of new firms in the soft drink industry (Profit maximization under imperfect competition, 2010).
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The structure of the cold drink industry in India is best described as...
The cold drink industry in India is best described as oligopolistic. This is due to several factors:
1. Few dominant players: The industry is dominated by a few major players such as Coca-Cola, PepsiCo, and Parle Agro. These companies have significant market power and control a large portion of the market share.
2. High barriers to entry: The cold drink industry requires significant capital investment in manufacturing, distribution, and marketing. This makes it difficult for new players to enter the market and compete with established companies.
3. Interdependence among firms: The actions of one company in the industry can have a significant impact on the others. For example, if one company lowers prices, it could lead to a price war and hurt the profits of all companies in the industry.
4. Non-price competition: Since the products are largely similar, companies differentiate themselves through branding, advertising, and other marketing strategies. This creates a situation where companies compete for market share through non-price factors.
5. Price leadership: In an oligopoly, one or a few companies may set the prices, and others may follow suit. This is known as price leadership, and it is often seen in the cold drink industry.
Overall, the cold drink industry in India exhibits the characteristics of an oligopoly, with a few dominant players, high barriers to entry, interdependence among firms, non-price competition, and price leadership.
1. Few dominant players: The industry is dominated by a few major players such as Coca-Cola, PepsiCo, and Parle Agro. These companies have significant market power and control a large portion of the market share.
2. High barriers to entry: The cold drink industry requires significant capital investment in manufacturing, distribution, and marketing. This makes it difficult for new players to enter the market and compete with established companies.
3. Interdependence among firms: The actions of one company in the industry can have a significant impact on the others. For example, if one company lowers prices, it could lead to a price war and hurt the profits of all companies in the industry.
4. Non-price competition: Since the products are largely similar, companies differentiate themselves through branding, advertising, and other marketing strategies. This creates a situation where companies compete for market share through non-price factors.
5. Price leadership: In an oligopoly, one or a few companies may set the prices, and others may follow suit. This is known as price leadership, and it is often seen in the cold drink industry.
Overall, the cold drink industry in India exhibits the characteristics of an oligopoly, with a few dominant players, high barriers to entry, interdependence among firms, non-price competition, and price leadership.
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The structure of the cold drink industry in India is best described asa)perfectly competitive.b)monopolistic.c)monopolistically competitive.d)oligopolistic.Correct answer is option 'D'. Can you explain this answer?
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The structure of the cold drink industry in India is best described asa)perfectly competitive.b)monopolistic.c)monopolistically competitive.d)oligopolistic.Correct answer is option 'D'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about The structure of the cold drink industry in India is best described asa)perfectly competitive.b)monopolistic.c)monopolistically competitive.d)oligopolistic.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The structure of the cold drink industry in India is best described asa)perfectly competitive.b)monopolistic.c)monopolistically competitive.d)oligopolistic.Correct answer is option 'D'. Can you explain this answer?.
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