1. Answer the following questions based on the accompanying diagram
a. How much would the firm's revenue change if it lowered price from $12 to $10? Is demand elastic or inelastic in this range?
b. How much would the firm's revenue changed if it lowered price from $4 to $2? Is demand elastic or inelastic in this range?
c. What price maximizes the firm's total revenue? What is the elasticity of demand at this point on the demand curve?

(see attached file for graph)

2. Suppose the own price elasticity of demand elasticity of demand for good X is -2, its income elasticity is 3, its advertising elasticity is 4, and the cross-price elasticity of demand between it and good Y is -6. Determine how much the consumption of this good will change if:
a. The price of good X increases by 5 percent
b. The price of good Y increases by 10 percent
c. Advertising decreases by 2 percent
d. Income falls by 3 percent

3. Suppose the cross-price elasticity of demand between goods X and Y is -5.How much would the price of good Y have to change I order to increase the consumption of good X by 50 percent.

4. For the first time in two years, Big G ( the cereal division of General Mills raised cereal prices by 2 percent. If as a result of this price increase, the volume of all cereal sold by Big G dropped by 3 percent, what can you infer about the own price elasticity of demand for Big G cereal? Can you predict whether revenues on sales of its Lucky charms brand increased or decreased? Explain.

With respect to the price elasticity of demand, construct a graph using the data in figure 1. Illustrate the ranges on the demand curve that indicate elastic, inelastic, and unitary elasticity. Explain your answers. Enter non-numerical responses in the same worksheet using tax boxes.
Quantity total

The ABC company manufacture AM/FM clock radios and sell an average 3000 units monthly at $25 each for retail store. it closest competitor produce a similar type of radio that sell for $ 28.
a. If the demand for ABC product has an elasticity coefficient of -3, how many it will sell per month if the price is lowered to 22?

Consider two investors (A and B) with the following demand curve for a stock:
A: p=100-q
B: p=150-2q
a) At a price of $50, how much will A and B purchase?
b) If the price falls to $30, who will increase their holdings more?
c) On this basis, which investor seems to be more overconfident?

Given the following demand function:
PriceP$ Quantity,QD(Pounds of steak) Arc Elasticity, ED Total Revenue Marginal Revenue
12 30 n.a n.a
11 40
10 50
9 60
8

See the attached file.
1. Consider an inverse demand function p=40-q/5
(a) Find the price elasticity when price is $5.
(b) Find the price at which elasticity is -0.6.
(c) Suppose you are currently producing 125 units. If you raise your quantity a little bit, will your revenue increase or decrease? Using elasticity concept,

1. A market consists of two individuals. Their demand equations are Q1 = 16-4P and Q2 = 20-2P respectively.
a. What is the market demand equation?
b. At a price of $2, what is the point price elasticity for each person and for the market?

A local dentist read an article published by the American Dental Association estimating that the elasticity of demand for the representative dentist's services is -2.5. How much should the dentist mark up their price over marginal cost? Step me through the calculations please.