1)The following function describes the demand condition for a company that makes caps featuring names of college and professional teams in a variety of sports.
Q = 2,000 - 100 P; where Q is cap sales and P is price.
a)How many caps could be sold at $12 each?
b)What should the price be in order for the company to sell 1,000 caps?
c)At what price would cap sales equal zero?
3) The Teenager Company makes and sells skateboards at an average price of $70 each.During the past year, they sold 4,000 of these skateboards. The company believe that the price elasticity for this product is about
-2.5.If it decreases the price to $63, what should be the quantity sold? Will revenue increase? Why?
A Complete, Neat and Step-by-step Solution is provided in the attached file.
Cost-Benefit Analysis: Application
What do you think are some of the more important, impacting cost benefit analysis that could affect a society? Do you think such an analysis could be carried out on "hot topics" like abortion, the death penalty, and same-sex marriage? What sort of items should be considered in such an analysis on budget-related issues like health care and government program cuts?
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