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Economics project(Ankur kimtani)

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Price Elasticity of Demand for Pizza in Pune

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Economics project(Ankur kimtani)

  1. 1. Group members: AASHIT PRAKHAR (14003) ANKUR KIMTANI (14014) DEV DUGGAL (14019) RASHMI RANJAN (14050)
  2. 2.  The change in the quantity demanded of a product due to change in its price is called price elasticity of demand.  Price elasticity of demand = Percentage change in Quantity demanded of x/ Percentage change in Price of x
  3. 3. •Pizza is an emerging fast food in Indian urban areas. •With the arrival of branded pizza such as Domino's and Pizza Hut in early mid-1990s, it has reached almost all major cities in India by 2013. •The Indian organized pizza market will surge more than 27% during the year 2012-2015.
  4. 4.        Age up to 25 years(COLLEGE) Middle income group(D-MART) Health conscious(GYM) Professional employees(IT PARK) Entrepreneurs(SHOPKEEPERS IN BAVDHAN) Dominos in residential area(BAVDHAN) Dominos in commercial area(HINJEWDI)
  5. 5. CATEGORY 1 UP TO 25 NO OF WHEN PRICE PERSON Consumption INCREASE BY ' per month 10% BY BY 20% 30% WHEN PRICE DECREASE BY BY 10% 20% BY 30% 1 4 4 1 0 4 4 5 2 5 5 4 4 5 6 6 3 3 2 2 1 5 6 7 4 5 4 3 3 4 4 5 5 2 1 1 0 1 1 1 6 3 3 2 1 4 5 6 7 2 1 1 1 2 3 4 8 2 2 2 2 2 2 2 9 1 1 1 1 2 2 2 10 2 1 1 1 2 2 2 29 24 20 14 32 35 40 Total
  6. 6. % INCREASE IN PRICE DECREASED DEMAND % CHANGE IN DEMAND ELASTICITY =%CHANGE IN QUANTITY DEMANDED/%CHANGE IN PRICE 10% 24/29*100=82% 18% 18%/10%=1.8 20% 20/29*100=69% 31% 31%/20%=1.55 14/29*100%= 48% 52.00% 30% % DECREASE IN PRICE INCREASED DEMAND % CHANGE IN DEMAND 52.5/30.5=1.73 ELASTICITY =%CHANGE IN QUANTITY DEMANDED/%CHANGE IN PRICE 10% 32/29*100= 110% 10% 10%/10%=1 20% 35/29*100= 121% 21% 21%/20%=1.05 30% 40/29*100= 138% 38% 38%/30%=1.26
  7. 7. Elasticity Index for Both Situations ( When price increase & when price decrease) elasticity when price decrease by elasticity when price increase by Category 10% 20% 30% 10% 20% 30% 1 Age- up to 25 1.8 1.55 1.73 1 1.05 1.26 2 Middle income Group 2.5 1 1.2 2.2 1.1 1.16 3 health Conscious 1.5 1.25 1.16 1 1.5 1.83 4 Professional Employees 1.1 0.87 1.16 1 0.65 0.7 1 1.5 1.4 1.1 1 1 6 Dominos in Residentional Area 1.8 1.6 2.7 2.7 2.7 1.2 7 Dominos in Commercial Area 1.8 1.6 1.6 0.4 1.4 1.76 5 Entrepreneur
  8. 8. CATEGORY PRICE INCREASE BY 10% 1 1.8 2 2.5 3 1.5 4 1.1 5 1 6 1.8 7 1.8 3 2.5 ELASTICITY 2 1.5 Series1 Linear (Series1) 1 0.5 0 0 1 2 3 4 SEGMENTS 5 6 7 8
  9. 9. Highest price elasticity is of Middle income group. Lowest price elasticity is of entrepreneurs.
  10. 10. CATEGORY PRICE DECREASE BY 10% 1 1 2 2.2 3 1 4 1 5 1.1 6 2.7 7 0.4 3 2.5 ELASTICITY 2 1.5 Series1 Linear (Series1) 1 0.5 0 0 1 2 3 4 SEGMENTS 5 6 7 8
  11. 11.  Highest price elasticity is of dominos located in residential areas.  Lowest price elasticity is of dominos in commercial areas.
  12. 12. CATEGORY PRICE INCREASE BY 20% 1 1.55 2 1 3 1.25 4 0.87 5 1.5 6 1.6 7 1.6 1.8 1.6 1.4 ELASTICITY 1.2 1 Series1 0.8 Linear (Series1) 0.6 0.4 0.2 0 0 1 2 3 4 SEGMENTS 5 6 7 8
  13. 13.  Highest price Elasticity is for dominos located in commercial & Residential areas.  Lowest price Elasticity is for Professional Employees.
  14. 14. CATEGORY PRICE DECEASE BY 20% 1 1.05 2 1.1 3 1.5 4 0.65 5 1 6 2.7 7 1.4 3 2.5 ELASTICITY 2 1.5 Series1 Linear (Series1) 1 0.5 0 0 1 2 3 4 SEGMENTS 5 6 7 8
  15. 15.  Highest price Elasticity is for Dominos located in Residential Area.  Lowest price Elasticity is for professional persons.
  16. 16. CATEGORY PRICE INCREASE BY 30% 1 1.73 2 1.2 3 1.16 4 1.16 5 1.4 6 2.7 7 1.6 3 2.5 ELASTICITY 2 1.5 Series1 Linear (Series1) 1 0.5 0 0 1 2 3 4 SEGMENTS 5 6 7 8
  17. 17.  Highest price elasticity is for Dominos located in Residential Area.  Lowest price elasticity is for Health Conscious persons & Professional persons.
  18. 18. CATEGORY PRICE DECREASE BY 30% 1 2 1.16 3 1.83 4 0.7 5 1 6 1.2 7 2 1.26 1.76 1.8 1.6 ELASTICITY 1.4 1.2 1 Series1 0.8 Linear (Series1) 0.6 0.4 0.2 0 0 1 2 3 4 SEGMENTS 5 6 7 8
  19. 19. Analysis For 30% decrease in price(demand increases) • Highest price Elasticity for Health Conscious persons. • Lowest is for professional Employees
  20. 20. Inferences THE HIGHEST PRICE ELASTICITY IS FOR THE DOMINOS LOCATED IN THE RESIDENTIAL AREAS.  THE LOWEST PRICE ELASTICITY IS FOR THE PROFESSIONAL EMPLOYEES.

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