a) Mass-market considers all demographics and is rather not specific and targeting any

specific demographic therefore selling to the majority of people. In the case study PP
produces the highest quality of luxury pies which are targeting the upper-class
demographic which can afford the highest quality luxury pies. In the production of the
cheaper pie the mass market is considered due to its lower price and therefore higher
accessibility as stated in the case study.

Prime Pies

Profit and Loss account of December 31, 2023

Sales revenue: $159600

Profit before tax and interest: $159600
Profit before tax: $151620
Profit before Interest: $136458
Gross Profit: $136458
Expenses: $102655.1
Dividends: $92389.59
Retained profit: $92389.59.

b) 136458/159600 x 100 = 85.5

c) One advantage of PP selling older noncurrent assets to finance the production of the new
pi is the fact that the production of these new pies will be cheaper for the company to
produce. This decrease in price will introduce the mass market which could potentially
increase the profits for the company. One disadvantage of the usage of older non-current
assets is the lowering of expectations for the customer in which the customer will expect
similar quality to their luxury pies and instead will be receiving a more standardized test
which might not fit their expectations for the company. This could potentially separate
the consumer base which could hamper the loyalty of the customer to the company as
stated in the case study.