Please step me through the following calculations:
- How many T-shirts could the cafe sell at $5 each?
- What price would they have to charge to sell 200 T shirts?
- Calculate the own price elasticity of demand for T-shirts at a price of $20.
- Calculate the inverse demand curve for the restaurant?
Please see the attached file.
Given, Q = 300 - 5P
a) When the price is $5, then the cafe could sell,
Q = 300-5 * 5
Q =275 T-shirts
b) In order to sell 200 T-shirts, the respective price should be,
The solution answers the question(s) below.