Coca Cola Milestone 3

Coca Cola like all other companies within US boarders must contented with the Federal Reserve Bank’s monetary policies. Monetary policy refers to the increasing and decreasing of money supply in the economy to either speed up or slow down the overall economy. This affect or influences interest and inflation rates. Monetary policies implemented by the Fed can affect Coca Cola’s ability to expand, invest, borrow, and even save money. When the monetary policy calls for low interests’ rates, they positively affect Coca Cola’s capital growth and enables the company to purchase new ventures and acquisitions to bolster their company’s position as the number one beverage company. In the past low interest rates created opportunities to acquire other brands like Honest Tea in 2011, ZICO coconut water in 2013, and stakes in Monster Beverage in 2014. When the monetary policy calls for high interests’ rates like the ones we are currently experiencing, they can hinder Coke’s ability to invest in its key market country in addition to producing in other countries as well. Inflation rates also affect Coca-Cola’s new research on products development and technology (Anders, 2013, p. 9). A prime example of fiscal policy affect the Coca Cola company is the government taxing “alcohol and sugar-sweetened beverages helps to reduce consumption and prevent the onset of related chronic diseases such as cardiovascular diseases, cirrhosis of the liver, obesity and diabetes,” according to the Center for Global Development.

References

Anders, J. (2013). Coca-Cola's Marketing Strategy: An Analysis of Price, Product and Communication. GRIN Verlag.

The Coca‑Cola Company –Tax Policy. (2021). Paragraph 19(2) of Schedule 19 to the Finance Act 2016. https://www.coca-cola.co.uk/tax-policy