O Determine the profit maximizing level of output when the marketing price for the good is $75 unit. -show this on graph by making. drawing (straight edgej write # (good estinate) below graph
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- Hans is a butcher in Washington. The following contains data on prices and weekly sales at his shop Good Beef Chicken Price 9.00/lbs $4.00/lbs Quantity 400 lbs 300 lbs ShS He estimates that the own price elasticity for beef is 2 and for chicken is .75. He also estimates that the cross price elasticity for chicken is .60. His current revenue from the sale of these two goods is making a total of $4800/week. In the spirit of the return to good times and outdoor grilling, he has decided to lower the price of beef for the summer, from $9.00 to $8.55. Overall, Hans can expect to take in dollars in revenue, given the information in this problem? (Revenue = Price x sales). Record your answer without a dollar sign and without a comma. Helpful Hint: In this problem, we are not changing the price of chicken.le Chrom elearn.squ.edu.om/m Academic) of Microeconomics Spring20 fall20 A local pizzeria raised its price from $9 to $11 for each pizza and the sales of its pizza decreased from 150 to 100 per day. What is the price elasticity of demand in this case? Select one: O a. -1/2 O b. 1/2 O c. 2 O d. -2 Next page 9448A9. Application: Elasticity and hotel rooms The Inlinwing graph input tool shows the daily demand for hotel moms at the Oceans Hotel and Casino in Atlantic City, New Jersey. To help the hotel management better understand the market, an woonomist identified three primary factors that affect the demand for me ach night. The demand factum, lung with the values corresponding to the initial demand curve, are shown in the following table and alungside the graph input tool. Demand Factor Average American household income Roundtrip airfare from New Orleans (MSY) to Atlantic City (ACY) Room ratu at the Meadows Hotel and Casino, which is near the Ocean Use the graph input tool to help you answer the following questions. You wil not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. Show Transcribed Text 600 450 ****** 100 0 Demand ++ 55155 366 350 351 350 100 ans…
- The shorter the period of time consumers have to adjust to price changes, the O lower; income O lower price O higher; income higher; price the elasticity of demand.Creative Homework/Short Project Assume that you arean entrepreneur who runs a bakery that sells glutenfree breads and cakes. You believe that the currenteconomic conditions merit an increase in the price ofyour baked goods. You are concerned, however, thatincreasing the price might not be profitable becauseyou are unsure of the price elasticity of demand for yourproducts. Develop a plan for the measurement of priceelasticity of demand for your products. What findingswould lead you to increase the price? What findingswould cause you to rethink the decision to increaseprices? Develop a presentation for your class outlining(1) the concept of elasticity of demand, (2) why raisingprices without understanding the elasticity would bea bad move, (3) your recommendations for measurement, and (4) the potential impact on profits for elasticand inelastic demandWhat are 2 products with different price elasticities of demand, and how do you analyze how firms can use information about price elasticity of demand to their advantage?
- Creative Homework/Short Project Assume that you arean entrepreneur who runs a bakery that sells glutenfree breads and cakes. You believe that the currenteconomic conditions merit an increase in the price ofyour baked goods. You are concerned. however, thatincreasing the price might not be profitable becauseyou are unsure of the price elasticity of demand for yourproducts. Develop a plan for the measurement of priceelasticity of demand for your products. What findingswould lead you to increase the price? What findingswould cause you to rethink the decision to increaseprices? Develop a presentation for your class outlining(I) the concept of elasticity of demand, (2) why raisingprices without undetstanding the elasticity would bea bad move. (3) your recommendations for measurement. and (4) the potential impact on profits for elasticand inelastic demandRefer to the figure below: A P 16 11 8. 100 150 225 300 350 Quantity If the price is $16, the resulting O shortage will lead to a fall in price. O surplus will lead to a fall in price. O shortage will lead to a rise in price. O surplus wil Icad to a risc in pricc. を %24OOK rink erences Aruna owns Pottery Plus, a small firm that produces terra cotta pots for sale in the Edmonton area. The graph below shows Aruna's demand curve. Mc Graw Hill Price ($) 40 36 32 28 24 20 16 12 8 4 0 4 8 12 16 20 24 28 32 36 40 Quantity per period
- 38. Suppose that a consumer's annual(income decreased by RO 300, causing a 15% decrease in the quantity of beef the consumer demands. If the consumer has an Ancome elasticjty of demand.of 1.0 for beef, what is her new income? a. RO 2700, b. RO 3000. C. RO 1700 d. RO 3300. 15 |-0 = 300 -1,76. Elasticity and total revenue The following graph shows the daily demand curve for bikes in Denver. Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve. Note: You will not be graded on any changes made to this graph. 2 Total Revenue PRICE (Dollars per bike) 88NR S 89 88 89 O 300 275 18 27 35 45 54 53 72 QUANTITY (Bikes) 91 Demand 90 99 108One of South Africa’s cellphone operators, Cell C, is changing their overall business strategy.The focus is now on providing customers with “affordable and accessible services." To do thisthey need your economic expertise.They know that when price for premium services increases from R2/minute to R2.2/minute thedemand for their services falls from 12 customers to 10 customers.a. Using the point formula calculate the price elasticity of demand. b. What type of elasticity does Cell C’s services have over this price range? Motivate youranswer.