3) You make a lightweight compact foldable windbreaker. Your brand, Desert Wind Jackets, is well established in the Southwest. In a drive to broaden your appeal and open new markets, you have rebranded under the simple logo DWJ. The strength of your brand, loved by your customers in the Southwest, means you have a price elasticity on demand of -2.76. Market research indicates that in the Upper West, where there is some knowledge of your brand, the price elasticity of demand is -3.50. In New England, where you are least known, it is estimated that the price elasticity of demand will be quite high, -5.76. Your marginal cost per jacket is $198.33. (ROUND TO THE NEAREST WHOLE DOLLAR) a) What price will you charge in your southwestern region? b) What price will you charge in your upper-western region? c) What price will you charge in your New England region?
3) You make a lightweight compact foldable windbreaker. Your brand, Desert Wind Jackets, is well established in the Southwest. In a drive to broaden your appeal and open new markets, you have rebranded under the simple logo DWJ. The strength of your brand, loved by your customers in the Southwest, means you have a price elasticity on demand of -2.76. Market research indicates that in the Upper West, where there is some knowledge of your brand, the price elasticity of demand is -3.50. In New England, where you are least known, it is estimated that the price elasticity of demand will be quite high, -5.76. Your marginal cost per jacket is $198.33. (ROUND TO THE NEAREST WHOLE DOLLAR) a) What price will you charge in your southwestern region? b) What price will you charge in your upper-western region? c) What price will you charge in your New England region?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:3) You make a lightweight compact foldable windbreaker. Your brand, Desert Wind Jackets, is
well established in the Southwest. In a drive to broaden your appeal and open new markets, you
have rebranded under the simple logo DWJ. The strength of your brand, loved by your customers
in the Southwest, means you have a price elasticity on demand of -2.76. Market research
indicates that in the Upper West, where there is some knowledge of your brand, the price
elasticity of demand is -3.50. In New England, where you are least known, it is estimated that the
price elasticity of demand will be quite high, -5.76. Your marginal cost per jacket is $198.33.
(ROUND TO THE NEAREST WHOLE DOLLAR)
a) What price will you charge in your southwestern region?
b) What price will you charge in your upper-western region?
c) What price will you charge in your New England region?
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