Purchase Solution

Macroeconomics: Elasticity, Demand, and Total Revenue

Not what you're looking for?

Ask Custom Question

Prepare an analysis by answering the questions below. Be sure to cite your references using APA format.

Demand Schedule for Barbeque Dinners

Price Quantity Demanded Total Revenue Elasticity Coefficient Elastic or Inelastic
$4 100
__________ XXXX XXXX
6 80
__________ __________ __________
8 60
__________ __________ __________
10 40
__________ __________ __________
12 20
__________ __________ __________
14 1
__________ __________ __________

Calculate the total revenue for each level of demand.

Using the midpoints formula presented in the text, calculate the elasticity coefficient for each price level, starting with the coefficient for the $4 to $6 level. For each coefficient, indicate what type of elasticity is indicated, elastic demand, inelastic demand, or unitary demand.

Define elastic, inelastic, and unitary elasticity means. How are these related to total revenue?

Explain how the elasticity changes as price increases. Why is this happening?

Attachments
Purchase this Solution
Solution Summary

Elasticity, Demand, and Total Revenue are determined. This solution defines the terms elastic, inelastic and unitary elasticity and how they relate to total revenue. The solution also explains how the elasticity changes as price increases. The total solution is 513 words.

Solution Preview

See the attached file. Thanks.

Demand Schedule for Barbeque Dinners
Price Quantity Demanded Total Revenue Elasticity Coefficient Elastic or Inelastic
$4 100 __________ XXXX XXXX
6 80 __________ __________ __________
8 60 __________ __________ __________
10 40 __________ __________ __________
12 20 __________ __________ __________
14 1 __________ __________ __________

A. Calculate the total revenue for each level of demand.
See the following table for calculations.

Total Revenue = Price * Quantity Demanded
Price Quantity Demanded Total Revenue Elasticity Coefficient Elastic or Inelastic
$4 100 $400 XXXX XXXX
6 80 $480 -0.56 Inelastic
8 60 $480 -1.00 Unitary
10 40 $400 -1.80 Elastic
12 20 $240 -3.67 Elastic
14 1 $14 ...

Purchase this Solution
Free BrainMass Quizzes
Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

View More Free Quizzes
Related BrainMass Solutions

  • Difference Between Microeconomics and Macroeconomics

    Macroeconomics - Aggregate demand in general refers to total spending by households, businesses, governments, and foreigners on domestically produced final goods and services.

  • Macroeconomics

    324852 Macroeconomics: elasticity and marginal rate of substitution 1. Demand curve: P = 1,000 â?" 25Q, where P is price and Q is quantity sold per month.

  • Question about Economics - Macroeconomics

    a.Find the price elasticity of demand for each group customers at the current price and quantity.

  • CLEP test Short Answer - Utility Elasticity Production

    A rise in the price of a product whose demand is elastic will reduce the total revenue of the firm. Can you please explain this concept in terms of relative percentage changes and concepts. 6. A firm's total fixed cost is $360,000.

  • Macroeconomic Aggregates

    5) Summarize the relationship between elasticity, price changes, and changes in total revenue. 6) Distinguish between "a change in demand" and "a change in quantity demanded."

  • Explained Answers to 5 M/C Macroeconomics Quiz Questions

    This solution gives answers and explanations to five common Macroeconomics quiz questions. Topics covered include: Price elasticity of demand Changes in demand Macroeconomic vs Microeconomic models Economic liberalism Comparative advantage

  • elasticity of demand and revenue

    72779 Contrast elasticity of demand and revenue Is there a relationship between the elasticity of demand and revenue? Explain. Yes, there exists a relationship between the elasticity and total revenue.

  • Price Elasticity of demand and revenue maximization

    For prices below 125 demand is elastic. Solution describes the steps for calculting arc and pint elasticities of demand. It also expains the relation between total revenue and elasticity of demand.

  • Elasticity, Demand, and Total Revenue

    299089 Elasticity, Demand, and Total Revenue If possible try to write down references please. See the attached file. Hope this will help.

View More Related Solutions