EC120 Lecture Notes - Lecture 2: Cappuccino, Espresso, Great News

• School: WLU
• Department: Economics
• Course: EC120
• Professor: Laura Allan

Document Summary

M(cid:455) (cid:396)e(cid:272)o(cid:373)(cid:373)e(cid:374)datio(cid:374) fo(cid:396) joe"s ja(cid:448)a is to pu(cid:396)(cid:272)hase (cid:374)e(cid:449) (cid:272)offee (cid:373)a(cid:272)hi(cid:374)es, i(cid:374)(cid:272)ludi(cid:374)g esp(cid:396)esso a(cid:374)d cappuccino machines, (cid:272)o(cid:373)(cid:271)i(cid:374)ed (cid:449)ith a(cid:374) aestheti(cid:272) upg(cid:396)ade. Joe"s fa(cid:272)i(cid:374)g a(cid:374) i(cid:373)(cid:373)ediate p(cid:396)o(cid:271)le(cid:373) of stagnant profits. This is a result of joe failing to meet customer needs. His customers have been asking for new fancy coffees such as espressos and cappuccinos but he has not been able to provide them. As a (cid:396)esult, he"s losi(cid:374)g (cid:272)usto(cid:373)e(cid:396)s to ta(cid:396)(cid:271)u(cid:272)ks. Pu(cid:396)(cid:272)hasi(cid:374)g the (cid:374)e(cid:449) (cid:272)offee machines would allow joe to meet his customer needs, make him more competitive and overall accomplish financial success. Combine this with an aesthetic upgrade, changing the (cid:862)(cid:448)i(cid:271)e(cid:863) of the place to feel more unique and (cid:272)o(cid:373)fo(cid:396)ta(cid:271)le, i(cid:374) (cid:272)o(cid:373)pa(cid:396)iso(cid:374) to his (cid:272)u(cid:396)(cid:396)e(cid:374)t (cid:862)s(cid:373)all (cid:271)ist(cid:396)o ta(cid:271)les(cid:863), (cid:449)ill (cid:271)e the solutio(cid:374) he so desi(cid:396)es to fi(cid:454) his stag(cid:374)a(cid:374)t p(cid:396)ofits.