16. Revenue with Substitutable Products. The Camera Shop sells two popular modelsof digital single lens reflex (DSLR) cameras. The sales of these products are not inde-pendent; if the price of one increases, the sales of the other increases. In economics.these two camera models are called substitutable products. The store wishes to estab-lish a pricing policy to maximize revenue from these products. A study of price andsales data shows the following relationships between the quantity sold (N) and price(P) of each model:NA 195 0.6PA + 0.25PBN = 301+0.08PA-0.5PBa. Construct a model for the total revenue and implement it on a spreadsheet.b. Develop a two-way data table to estimate the optimal prices for each product inorder to maximize the total revenue. Vary each price from $250 to $500 in incre-ments of $10.

In part (a), we need to construct a model for the total revenue. I provided the formula for total…

Answered: 16. Revenue with Substitutable…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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If the price of streaming movie rental is $7.00, Darrin will rent 4 movies in a month. If the price of a streaming movie rental is $4.00, Darrin will rent 9 movies in a month. Using the Midpoint Method for Elasticity, what is Darrin's Price Elasticity of Demand for streaming movie rentals (round all calculations to the closest ten-thousandths so that your percentages are rounded to the closest hundredths; round your final answer to the closest hundredths)?What is Darrin's Price Elasticity of Demand for streaming movie rentals (round all calculations to the closest ten-thousandths (4 decimal places) so that your percentages are rounded to the closest hundredths; round your final answer to the closest hundredths)? Is his demand Elastic, Inelastic, or Unitary? If Darrin is the typical streaming movie rental customer, should the company increase or decrease their price of streaming movie rentals to increase revenues?
A firm started advertising its product and this changed the product’s elasticity from -2 to -1.5. If, prior to advertising, the firm was maximizing profit by charging $10, the firm should a. raise price from $10 to $15 b. reduce price from $10 to $6.67 c. raise price from $10 to $13.33 d. reduce price from $10 to $7.50 Note:- Please refrain from offering handwritten solutions. Please ensure that your response maintains accuracy and quality to avoid receiving a downvote. Take care of plagiarism. Answer completely. You will get up vote for sure.
Do not use Ai. Answer in all options.
17. How might advertising lead to a shift in the demand curve? By increasing the popularity of inferior goods By increasing awareness and changing the elasticity of demand By causing demand to become much more elastic By allowing the law of demand and law of supply to reach the market equilibrium
Graph and solve attachments:
At many municipal golf courses, local residents pay a lower fee to play than other golfers do. One necessary condition for the golf course to be able to successfully price discriminate according to residency is that A. they can check the identification cards of golfers to determine residency. endroite tod B. local resident golfers and other golfers have the same price elasticity of demand to play at the to cad aluen air.com 0. A ...8 851 0 municipal course. C. there are many golf courses nearby from which golfers can choose. D. they require all golfers to rent a cart.
5. Elasticity and total revenue The following graph shows the daily demand curve for bikes in Miami. . Use the green rectangle (triangle symbols) to compute total revenue at various prices along the demand curve. Note: You will not be graded on any changes made to this graph. 300 275 250 Total Revenue 225 200 A 175 150 125 100 75 50 25 Demand 10 15 20 25 30 35 40 45 50 55 60 QUANTITY (Bikes) On the folowing graph, use the green point (triangle symbol) to plot the annual total revenue when the market price is $50, $75, $100, $125, $150, $175, and $200 per bike. 5300 4500 Total Revenue 4500 400 W 3700 3300 2900 2500 2100 1700 25 50 75 100 125 150 175 200 225 250 275 300 PRICE (Dollars per bike) According to the midpoint method, the price elasticity of demand between points A and B is approximately Suppose the price of bikes is currently $100 per bike, shown as point B on the initial graph. Because the demand between points A and B is va $25-per-bike increase in price will lead to v in…
3. The effects of price changes on total revenue Edison's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Edison produced four fire engines, but he has decided to increase production to five fire engines. The following graph shows the demand curve Edison faces. As you can see, to sell the additional engine, Edison must lower his price from $105,000 to $90,000 per fire engine. Note that while Edison gains revenue from the additional engine he sells, he also loses revenue from the initial four engines because he sells them all at the lower price. Use the purple rectangle (diamond symbols) to shade the area representing the revenue lost from the initial four engines by selling at $90,000 rather than $105,000. Then use the green rectangle (triangle symbols) to shade the area representing the revenue gained from selling an additional engine at $90,000. (Note: Area is shown in thousands.) ICE (Thousands of dollars per fire engine). 150 135…
How do I get the price elasticity number?? and how do I graph it? P Q Price Total Elasticity Revenue $9.00 1 - 9 $8.00 2 16 $7.00 3 21 $6.00 4 24 $5.00 5 25 $4.00 6 24 $3.00 7 21 $2.00 8 16
Consider the following pairs of goods. In each case, which would you expect to have the more elastic demand? Why? a. water or diamonds b. insulin or nasal decongestant spray c. food in general or breakfast cereal d. gasoline over the course of a week or gasoline over the course of a year e. personal computers or IBM personal computers
10. Comics The demand curve for original Iguanawoman comics is given by (400 – p)² (0
am. 122.

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