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In the News

Going nuts for Nutella

Penny Brooks

26th January 2018

French consumers are showing what must be almost infinitely elastic price elasticity of demand for Nutella. Supermarket Intermarche have discounted the price by 70%, from 4.50 euros a jar to 1.40 euros, presumably as a loss-leader to bring customers into their stores so that they will buy the rest of their groceries as well while they are there.

The response is extreme - they sold out in 15 minutes, with customers battling to get to the shelves. The police had to be called to stem the violence - "They are like animals. A woman had her hair pulled, an elderly lady took a box on her head, another had a bloody hand," one customer told French media. Have a look at the video in this report, and try to estimate the PED!

Penny Brooks

Formerly Head of Business and Economics and now Economics teacher, Business and Economics blogger and presenter for Tutor2u, and private tutor

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