Essay Available:
Pages:
2 pages/≈550 words
Sources:
5
Style:
Harvard
Subject:
Mathematics & Economics
Type:
Essay
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
$ 8.64
Topic:
Coffee Prices as Influenced by Distance and Consumer Preferences
Essay Instructions:
Focus in convenience vs price. Consumers prefer convenience of being able to dispose of a cup once it’s been used, and not carry a reusable one around. Talk about their preference for convenience compared to desire for lower prices and maximising economic utility. Does the discount in price superceed the convenience or not? Two economic reasonings need to be combined: 1. behavioral economics 2. consumer preference; when talking about convenience, you can refer to the convenience brought by the distance from coffee shop to work place or universities; please refer to The Undercover economist for the reference part and article content the book
Essay Sample Content Preview:
Coffee Prices as Influenced by Distance and Consumer Preferences
Your name
Your Name
Subject and Section
Professor’s Name
April 10, 2023
Coffee is one of the most popular beverages worldwide, and coffee shops have become a part of daily life for many people. However, the prices of coffee in different locations can vary significantly. A common phenomenon is that coffee shops with shorter distances have higher prices than further distances with lower prices. This paper will explore the economic reasons for this phenomenon, focusing on consumer preferences for convenience versus price.
Distance and Coffee Prices
One of the main reasons coffee shops in the shorter distance have higher prices is the convenience factor. Consumers prefer the convenience and are willing to pay a premium for it. This is supported by the theory of behavioral economics, which states that people's behavior is often irrational and influenced by their biases and preferences (Jacques, 2022).
In his book The Undercover Economist, Tim Harford (2012) explains that convenience is a powerful motivator for consumer behavior. People are willing to pay more for convenient goods and services that save them time and effort. This is why coffee shops near workplaces or universities can charge higher prices. Consumers are willing to pay more for the convenience of grabbing a cup of coffee on their way to work or class without traveling a long distance. One example of this is in the case of Starbucks cafes. Compared to other local coffee shops, Starbucks charge higher rates, yet it is successful in increasing demand for such product. One of the reasons for this is because of the coffee shop’s location, which is always located in high foot traffic areas, where people could easily grab a cup of coffee conveniently and quickly .
However, this convenience factor is one of many reasons for the price difference between coffee shops in shorter and further distances. Consumer preference for lower prices and the desire to maximize their economic utility also play a role in this phenomenon. Economic utility refers to the satisfaction or happiness consumers derive from consuming a good or service. Consumers seek to maximize their economic utility by choosing the combination of goods and services that provide the most satisfaction for the least cost (Wang et al., 2021).
According to...
Get the Whole Paper!
Not exactly what you need?
Do you need a custom essay? Order right now: