Question

Coke is planning on marketing a new drink called Very Berry Coke which is a mixture of raspberry and blackberry flavors blended to perfection and added to the highly secret Coca-Cola formula. This new product is expected to reduce the sales of their existing product, Cherry Coke, by $10 million per year. This is an example of a:
A.complementary effect
B.substitutionary effect
C.opportunity effect
D.pro forma effect

Answer 1

Answer: Substitutionary Effect.

Explanation:

The new coke drink the very berry coke, has reduced the consumers demand for it's original product the Cherry Coke, which is as a result of the extra special flavors of the new drink: this is a typical example of the Substitutionary effect.

Substitutionary effect occurs, when consumers replace their demand for an existing product to go for a similar product of better quality or cheaper price range.