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Politics : Formerly About Advanced Micro Devices
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To: combjelly who wrote (760756)1/1/2014 5:32:42 PM
From: i-node1 Recommendation

Recommended By
FJB

   of 1574483
 
>> Not perfectly, but small price increases are readily absorbed without decreasing demand.

Talk about a particularly stupid response.

Small price increases will have an effect on demand just as large ones will. They just won't be as large. This is fairly basic arithmetic and I'm surprised you're having trouble with it.

Demand is NOT inelastic in the fast food business.

"We reviewed 160 studies on the price elasticity of demand for major food categories to assess mean elasticities by food category and variations in estimates by study design. Price elasticities for foods and nonalcoholic beverages ranged from 0.27 to 0.81 (absolute values), with food away from home, soft drinks, juice, and meats being most responsive to price changes (0.7–0.8). As an example, a 10% increase in soft drink prices should reduce consumption by 8% to 10%."

So, you get that, right?
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