Question: In the canned fruit and vegetable processing market, how will increased production costs (by 30%) due to: increases in raw material prices (fruit and vegetables
In the canned fruit and vegetable processing market, how will increased production costs (by 30%) due to:
- increases in raw material prices (fruit and vegetables due to floods, covid and shortages in labour supply),
- increases in packaging cost (cans due to increased commodity metals prices) and
- large increases in transport costs (fuel increases due to the Russia/Ukraine conflict)
impact the demand for say baked beans and spaghetti where the costs are passed on to the consumer, and where inflation has risen to 5% putting pressure on household incomes? Do we expect the demand to drop? Or do we consider income pressure means that the decline in purchases would be more inelastic?
Also, In this instance, are baked beans and spaghetti seen as in inferior goods?
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