When Kellogg's stopped producing Pop-Tarts, the Jiffy Wiffy Company suddenly found themselves with a large market share in the United States for breakfast pastries. Their domestic success has made them consider expansion into Australia and Europe. In addition, they have also recently developed Power-Tarts, an energy bar that has superior taste than Power-Bars, the industry leader.
The Jiffy Wiffy Company is determining the demand for their products to forecast performance in the United States
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Taste Preference of Substitutes
Even though Jiffy Wiffy captured most of the market when Kellogg's left, price and taste remain very important factors in the demand of Pop-Tarts. Power-Tarts are especially sensitive since they are newcomers to their market. By characterizing the variables that make up the demand for each product, domestic sales and overseas expansion can be properly forecasted.
Hall, R. & Lieberman, M. (2001). Introduction to Economics. Cincinnati, Ohio: South-Western College Publishing