12. The Vanier Cup, the finals of Canadian University football, was held on November 26, 2016at Tim Hortons Field in Hamilton, Ontario. The organizers learned a lot are already planningnext year's event! Based on what they learned this year, they know that the demand functionfor tickets to the game will be given by q = 200, 000 - 10, 000p, where p is the price chargedper ticket. The chief organizer for next year is an ambitious person who wants to set pricesso as to maximize revenue.(b)Write down an expression for the inverse demand function (price as a function ofquantity), total revenue (as a function of quantity), and marginal revenue (as a functionof quantity).Find the quantity and price that generate maximum revenue.(c) Derive an expression for the elasticity of ticket demand with respect to price. (Hint:your elasticity should be a function of the price, p.) What is the value of the elasticityat the revenue-maximizing price (your answer for price from part b)?

The demand function represents the quantity demanded by consumers at different price levels.Total…

12. The Vanier Cup, the finals of Canadian University football, was held on November 26, 2016 at Tim Hortons Field in Hamilton, Ontario. The organizers learned a lot are already planning next year's event! Based on what they learned this year, they know that the demand function for tickets to the game will be given by q = 200, 000 – 10, 000p, where p is the price charged per ticket. The chief organizer for next year is an ambitious person who wants to set prices so as to maximize revenue. (a) Write down an expression for the inverse demand function (price as a function of quantity), total revenue (as a function of quantity), and marginal revenue (as a function of quantity). (b) Find the quantity and price that generate maximum revenue. Derive an expression for the elasticity of ticket demand with respect to price. (Hint: your elasticity should be a function of the price, p.) What is the value of the elasticity at the revenue-maximizing price (your answer for price from part b)?

12. The Vanier Cup, the finals of Canadian University football, was held on November 26, 2016 at Tim Hortons Field in Hamilton, Ontario. The organizers learned a lot are already planning next year's event! Based on what they learned this year, they know that the demand function for tickets to the game will be given by q = 200, 000 – 10, 000p, where p is the price charged per ticket. The chief organizer for next year is an ambitious person who wants to set prices so as to maximize revenue. (a) Write down an expression for the inverse demand function (price as a function of quantity), total revenue (as a function of quantity), and marginal revenue (as a function of quantity). (b) Find the quantity and price that generate maximum revenue. Derive an expression for the elasticity of ticket demand with respect to price. (Hint: your elasticity should be a function of the price, p.) What is the value of the elasticity at the revenue-maximizing price (your answer for price from part b)?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

As the manager of Smith Construction, you need to make a decision on the number of homes to build in a new residential area where you are the only builder. Unfortunately, you must build the homes before you learn how strong demand is for homes in this large neighborhood. There is a 70 percent chance of low demand and a 30 percent chance of high demand. The corresponding (inverse) demand functions for these two scenarios are P = 300,000 -450Q and P = 700,000 -325Q, respectively. Your cost function is C(Q) = 135,000 + 172,500Q. How many new homes should you build, and what profits can you expect?
As the manager of Smith Construction, you need to make a decision on the number of homes to build in a new residential area where you are the only builder. Unfortunately, you must build the homes before you learn how strong demand is for homes in this large neighborhood. There is a 30 percent chance of low demand and a 70 percent chance of high demand. The corresponding (inverse) demand functions for these two scenarios are P = 400,000-250Q and P = 900,000-125Q, respectively. Your cost function is C(Q) = 185,000 + 652, 500Q. How many new homes should you build, and what profits can you expect? Number of homes you should build: homes Profits you can expect: $
Use the appropriate formulas to create two new columns (7 and 8) for total profit and profit margin, respectively. What is the maximum profit the EI Dorado Star can earn? What is the maximum possible profit margin? Are profit and profit margin maximized at the same point on demand?
You have decided to start a snow-plowing business whereby you will offer to plow the driveways of your neighbours' homes after heavy snowfalls. You are well known by everybody in your neighbourhood, you have a plow for the front of your truck, and you think that your neighbours would rather hire you than someone they do not know. From your research, you know that homeowners are charged an average of $40 to plow their driveways after a heavy snowfall. Interestingly, a few years ago, your research tells you that homeowners were charged an average of $25 to plow their driveways after a heavy snowfall. The average price has gone up, which excites you. Apply your learning about supply and demand to this fact pattern to analyze possible reasons for the increase in price. Consider the five factors that may impact demand and the 6 factors that may impact supply. What questions do you want answered before committing to this business?
A semiprofessional baseball team near your town plays two home games each month at the local baseball park. The team splits the concessions 50/50 with the city but keeps all the revenue from ticket sales. The city charges the team $100 each month for the three-month season. The team pays the players and manager a total of $1000 each month. The team charges $10 for each ticket, and the average customer spends $8 at the concession stand. Attendance averages 30 people at each home game. 1st attempt Part 1 The team earns an average of $ in revenue for each game and $ of revenue each season.With total costs of $ each season, the team finishes the season with $ of profit. Part 2 In order to break even, the team needs to sell tickets for each game. Round to the nearest whole number. Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
don't use ai answer,i will 5 upvotes
Walmart can be viewed as a first mover. Now suppose both Walmart and HEB are considering whether and how to enter a potential market. Market demand is given by the inverse demand function p= 900−q1−q2, where p is the market price margin, q1 is the quantity sold by Walmart and q2is the quantity sold by HEB. To enter the market, a retailer must build a store. Two types of stores can be built: Small and Large. A Small pantry store requires an investment of $50,000, and it allows the retailer to sell as many as 100 units of the goods at zero marginal cost. Alternatively, the retailer can pay $175,000 to construct a Large full-service supermarket that will allow it to sell any number of units at zero marginal cost. Assume Walmart stays out of the potential market (i.e.Walmart chooses not to enterN1at the first stage,q1= 0). Calculate HEB’s profit for the following cases: a.) HEB chooses not to enter N at the second stage after viewing Walmart’schoice. b.) HEB chooses to build a small…
Here is the revenue of four companies in the cable industry (hypothetical, but close to real). Please determine an HHI value based on this data. Pretend the entire market is just these 4 firms (note: this is revenue, not market share). Comcast $105 Billion Charter/Spectrum $50 Billion Cox $10 Billion Altice/Optimum $5 Billion What is the HHI value?
In recent years, there has been a growing trend towards healthier eating, and this has led to increased demand for brown bread. A 2022 survey by the Hartman Group found that 62% of consumers are trying to eat healthier, and 58% are looking for more whole grains in their diet. The following diagram illustrates the impact of an increase in demand for brown bread. Which of the following statements is INCORRECT? P R12 R11 R10 0 S a) b) 900 1 000 1 100 1 200 1 300 Q Before the increase in demand, the equilibrium price is R10 and the equilibrium quantity is 900. Owing to an increase in demand, the demand curve shifts from D to D1. At a price of R10, after the increase in demand, the quantity demanded is 1 200 and the quantity supplied is 1 100. c) At a price of R10, after the increase in demand, there is an excess demand. d) A new equilibrium position is formed after the increase in demand at an equilibrium price of R12 and an equilibrium quantity of 1 100.
Here is my question!
Realizing that there is a great potential for increased tax revenue, government officials in Homeyville began discussing how they could align Airbnb rentals with hotel stays from a tax perspective. Fast-forward to 2018, at which time Homeyville has finally made tax arrangements with Airbnb to levy a $40-per-room tax on rentals. However, now the market conditions have changed. More hosts have now entered the Airbnb market, and awareness of this hotel alternative has increased demand. The following graph shows the demand and supply curves for Airbnb rentals in 2018. Use the green rectangle (triangle symbols) to illustrate the area representing the revenue raised by a $40-per-room tax. Then use the black point (cross symbol) to shade the area representing the deadweight loss generated by this tax. PRICE (Dollars per rental) 200 190 180 Demand 2018 Tax Wedge 170 + 160 150 140 130 120 110 100 0 + 40 80 120 160 200 240 280 RENTALS (Rooms per day) Supply 2018 320 360 400 Tax Revenue…
Question 9 A computer reseller needs to decide how many laptops to order next month. The lowest end laptop costs $220 and the retailer can sell these for $300. However, the laptop manufacturer already announced that they are coming out with a new model in a couple of months. Any laptops that will not be sold by the end of next month will have to be heavily discounted at half-price. The reseller also needs to consider that every time he fails to fulfill a laptop order, he stands to lose $25 for every unit. Based on the past months’ sales, the reseller estimates the demand probabilities for sales (S) as follows: P(0 units) = 0.3; P(1 units) = 0.4; P(2 units) = 0.2; P(3 units) =0.1. The reseller thinks it’s a good idea to conduct a survey on whether or not his customers are going to buy laptops and how many. The survey results will either be Yes (Y), No (N), or Don’t Know (DK). The probability estimates of the results based on the demand for the number of units are: P(Y|S = 0 units) =…