Week 4 Part 1 evia, a natural cola sweetened with Stevia leaf extract, plans to launch a new flavor. U.S. cola sales last year were $29.4 billion. Cola sales and population are highly correlated (1% of population equals 1% of cola sales). Colas, in bottles and cans, are sold through the following channels (market share): (a) Superstores (e.g., Target, The Home Depot) 33%; (b) Grocery stores (31%); (c) Convenience stores (26%); (d) Specialty restaurant (e.g. pizza restaurant) 9%; (e) Mobile food outlets 1% Zevia, at first, plans to distribute the new flavor through grocery stores and Superstores in Ohio, Pennsylvania, Kentucky, West Virginia, and New York. Together these five states account for 15.30 % of the U.S. population (based on 2019 U.S. Census website estimates). What is Zevias relevant market in $? $2,878,848,000

$2,987,065,000

$2,243,888,000

$2,739,423,000

Part 2

Continuing from the Zevia question, assume the cola market grows 1.15% next year. If market share percentage by channel remains unchanged and Zevia has fixed costs of $225,000 and a contribution margin of 41.15%, what is its breakeven market share in the relevant market? (Show decimals as needed)

0.02%

1.13%

1.24%

1.41%