2. In Question #1 above, your first move as CEO is to develop recyclable packagi

Question

2. In Question #1 above, your first move as CEO is to develop recyclable packaging for your fast-food products. Answer the following questions in regard to such a move:

a. What are the positive externalities that would emerge from your recyclable packaging?

b. How could you translate these positive externalities into a competitive advantage for your firm?

c. Would such actions possibly lead to increased customer loyalty because of these actions?

Question number 1

You have been selected as the CEO for a fast-food company. Answer the following questions in regard to your new role:

What are some of the externalities that you would experience in the fast food business? Explain.

How might you handle claims that your fast-food is causing obesity among your patrons? Explain.

Should you be concerned about how the financial viability of the firm could be overrun by dealing with externalities? Explain.

Explanation / Answer

Answer:- The various positive externalities that would emerge from recyclable packaging are less emission of carbon dioxide gas, helps in making the environment cleaner and it will bring a positive and environment-friendly image in the public.

Answer:- These positive externalities can be converted into a competitive advantage to the firm by positioning the firm as an environmentally sensitive and friendly firm, this will attract more customers and boost customer loyalty and confidence.

Answer:- Yes, by having a positive public image and environment-friendly face to the community, this can help in creating a strong customer loyalty.

Answer:- a.    

The various externalities associated with the food business are a negative effect on the environment, degraded work performance, negative health effects, a greater demand for products than supply. The nature of the business will be undermined by the poor work performance. It is important to address all these issues effectively so that there can be an improvement in the performance and role of the food business.

b.     

The issue of obesity developed by the food must be tackled with the patrons by having a well-defined healthy diet in the fast food units. This will be quite helpful in developing a positive nature and implications of the fast food industry.

c.    

Would give a lot of significance to the fact that how effective management of externality can help the financial viability of the company particularly due to the fact that these negative externalities can result in negative performance and thus the management should take necessary steps to handle and manage these externalities to neutralize the effect on financial viability and stability of the business

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