Are long-run economic profits a possibility for Smart Balance? In long-run equilibrium, will Smart Balance have excess capacity or a markup?
While it’s not the biggest brand in margarine, Smart Balance has an edge on its rivals in that it’s made with a patented blend of vegetable and fruit oils that has been shown to help improve consumers’ cholesterol levels. Smart Balance sales have skyrocketed while overall sales for margarine have stagnated. It remains to be seen if Smart Balance’s healthy message and high price will resound with consumers.