1) Aksala Manufacturing has estimated the following demand curve for its colored ice cube product: (see chart in attached file) where log P is the natural log of the price, log Q is the natural log of quantity sold, and log Y is the natural log of income. a) What is the price elasticity of demand? On question 1, note
Suppose the price of apples rises from $3 a pound to $3.45 and your consumption of apples drops from 30 pounds of apples a month to 21 pounds of apples. Calculate your price elasticity of demand of apples. What can you say about your price elasticity of demand of apples? Is it Elastic, Inelastic, or Unitary Elastic?
8. Opportunity cost is best defined as A. the amount given up when choosing one activity over all other alternatives B. the amount given up when choosing one activity over the next best alternative C. the opportunity to earn a profit that is greater than the one currently being made D. the amount that is given up when
1. The demand for salt is relatively price inelastic, while the demand for pretzels is relatively price elastic. How can you best explain why? 2. If a stock is expected to pay an annual dividend of $20 forever, what is the approximate present value of the stock, given that the discount rate is 8%? (SHOW YOUR WORK!) - (H
1. You are given the following individual demand information that represents the demand for typing by students at a local college: Price per page Tom George Lisa Market $1.00 20 30 7 ____ $1.50 15 26 6 ____ $2.00 12 22 5 ____ $2.50 9 20 3 ____ $3.00 7 18 2 ____ $3.50 5 15 1 ____ $4.00 3 10 0 _
See attached file for full problem description. Homework help - Economics Company Inc, sells TV satellite dishes and has been in business for number of years. The firm's owner has become concerned about the firm's pricing, advertising, and other competitive strategies. He hired a consulting firm to estimate that demand
6. The sensitivity of the change in quantity demanded to a change in price is called A. income elasticity B. cross-elasticity C. price elasticity of demand D. coefficient of elasticity 7. Two goods are ____________ if the quantity consumed of one increases when the price of the the oth
To reduce imports of foreign oil, it has been proposed that the United States impose a substantial tax on gasoline. However, it is well known that the short-run elasticity of demand for gasoline is very low. What will happen to the total quantity of gasoline sold if there is an additional gasoline tax? Would the tax be effect
3. In the following table, calculate the elasticity of demand for each price range, using the mid-point formula. At what price does the producer maximize revenue? How can the firm use the information contained in the elasticity coefficient to determine pricing policy for profit maximization? Price Quantity
3. In the following table, calculate the elasticity of demand for each price range, using the mid-point formula. At what price does the producer maximize revenue? How can the firm use the information contained in the elasticity coefficient to determine pricing policy for profit maximization? Price Quantity
a. A barrier to entry creates an advantage for incumbents over new arrivals. True or false, explain. b. Rent control in New York is a prominent example of price floor. True or false, explain. c. When price is higher than the marginal revenue but lower than the average variable cost, the monopolist makes losses. d
An increase in elasticity of demand will increase monopoly power. This is absolutely correct. Does this mean that a monopolist will produce when demand is inelastic? Why?
The following demand function has been estimated for Fantasy pinball machines: QD = 3,500 - 40P + 17.5Px + 670U + .0090A + 6,500N where P = monthly rental price of Fantasy pinball machines Px = monthly rental price of Old Chicago pinball machines (their largest competitor) U = current unemployment rate in the 10 larges
A price elasticity (ED) of -1.50 indicates that for a ____________ increase in price, quantity demanded will ____________ by ______________. a one percent; increase; 1.50 units b one unit; increase; 1.50 units c one percent; decrease; 1.50 percent d one unit; decrease; 1.50 percent e ten percent; in
Chapter 4 7. The director of a theater company in a small college town is considering changing the way he prices tickets. He has hired an economic consulting firm to estimate the demand for tickets. The firm has classified people who go to the theater into two groups and has come up with two demand functions. The demand curves
The market demand for cotton socks is given by: Q=1,000+.5I-400P+200P' where, Q = Annual demand in number of pairs I = Average income in dollars per year P = Price of one pair of cotton socks P' = Price of one pair of wool socks Given that I = $20,000, P=$10, and P'=$5, determine: A. The price elasticity, e(Q,P) B
Viewpoint. According to Henry Ford, "it is better to sell a large number of cars at a reasonably small margin than to sell fewer cars at a larger margin of profit. Bear in mind that when you reduce the price of the car without reducing the quality you increase the possible number of purchases." (a) In 1909, Ford introduced
Please show the work in answering the below questions. Thank you. 1. B. B. Lean's deluxe garment bag sales recovered from 4,800 units to 6,000 units following a price reduction from $140 to $130 per unit. Calculate B. B. Lean's arc price elasticity of demand for this product. 2. Calculate point price elasticity of demand
1. Clothing stores affiliated with The Gap, Inc, offer a 14-day "price adjustment" policy: for example, if you purchase a shirt for $80 and it is subsequently marked down to $55, you can bring your receipt back to the store and receive a $25 refund within 14 days of your original purchase. What would stores voluntarily limit the
Suppose the price of apples rises from $3 a pound to $3.45 and your consumption of apples drops from 30 pounds of apples a month to 21 pounds of apples. Calculate your price elasticity of demand of apples. What can you say about your price elasticity of demand of apples? Is it Elastic, Inelastic, or Unitary Elastic?
Question 1: Demand for a product produced by a firm is given by the expression: P = 60 ? 5Q. Fixed cost is 20. Variable costs of producing Q units are VC (Q) = ? Q2 + 16Q. (I) Find expressions for total, average and marginal costs. Find expressions for total, average and marginal revenue. Find an expression for profit. (II) F
In many regions, local governments offer customized automobile license plates, also called "vanity tags." In these programs, a driver can choose to pay an additional fee over and above the basic annual fee charged to register a vehicle and, in return, the driver is allowed to choose the letter and number combination for their a
A problem do to study for.... Suppose the own price elasticity of market demand for retail gasoline is -0.9 and Rothschild Index is 0.6 and a typical gasoline retailer enjoys sales of $1.2 Million annually. What is the price elasticity of demand of a representative gasoline retailer's product?
The elasticity of demand for a firm's products are -2 and its advertising elasticity of demand is 0.1 a. Determine the firm's optimal advertising-to-sales ratio? b. If the firm revenues are $50,000.00, what is its profit-maximizing level of advertising?
1) Define utility and marginal utility? 2) What is the price elasticity of demand? 3) Relate price elasticity to changes in total revenue with a price increase? 4) List and discuss the determinants of price elasticity. 5) How do normal and inferior goods differ? 6) Define technological (or production) efficiency? 7)
Suppose the price of apples rises from $3 a pound to $3.45 and your consumption of apples drops from 30 pounds of apples a month to 21 pounds of apples. Calculate your price elasticity of demand of apples. What can you say about your price elasticity of demand of apples? Is it Elastic, Inelastic, or Unitary Elastic? Be sure to s
1) Consider a firm selling two products, A and B, that substitute for each other. Suppose that an entrant introduces a product that is identical to product A. What factors do you think will affect (a) whether a price war is initiated, and (b) who wins the price war? 2) The following table reports the distribution of profits
The Boeing Aircraft Company has dominated the commercial aircraft market for decades, but its position of influence has lessened in recent years. Its chief competitor, Airbus, has made significant market gains, and may be posed to become the number one producer of commercial aircraft in the near future. Where the rivalry is
I have the following data about the demand for Motorola picture phones: (own) price elasticity = -.12 cross-price elasticity with digital cameras = +3 income elasticity = +.15. If the goal of Motorola was to increase total sales revenue (ignoring cost considerations), would it raise or lower its selling price? Why?
You work for a employment agency, that sends out unemployment checks to the umemployed. The President, proposed a 21% increase in the minimum wage. Your boss wants you to provide you with a estimate of additional workers who will file for unemployment checks next year if this bill passes. Based on library research, you learn tha