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- D Question 1 A firm faces a demand curve for good Q as Q = 68-2.1P where P is price. If the firm decides to raise its price from $10 to $12.5, then quantity demanded should fall from to units. 48.50; 42.50 48.50; 41.75 O 47; 41.75 O 47; 42.50 units26) Larry's Carpet Cleaners can influence demand by advertising. Larry charges $50 per carpet, and he cleans 150 carpets per month. The price elasticity of demand is -4, and Larry spends $500 per month on advertising. If Larry is maximizing profits, calculate the advertising elasticity of demand.Figure 5-6 13 10 D 6 4 3 Supply 100 200 325 400 450 500 Refer to Figure 5-6. Using the midpoint method, what is the price elasticity of supply between points A and B? 0.1 0.43 2.33 1.0
- a. Define income elasticity of demand and cross-price elasticity of demand. b. If a firm determines that the income elasticity of demand for its good is negative (EY < 0), what can be said about this good? c. On the island of Econopia, the cross-price elasticity of demand between holilacs and bajwins is negative (EXY <0). What is the relationship between these goods?17 If the inverse demand function for computers was p = 70 - qAnd the selling price was $35 could you increase price to receive more revenue?Carlos's Fire Engines is the sole seller of fire engines in the fictional country of Pyrotania. Initially, Carlos produced four fire engines, but he has decided to increase production to five fire engines. The following graph shows the demand curve Carlos faces. As you can see, to sell the additional engine, Carlos must lower his price from $105,000 to $90,000 per fire engine. Note that while Carlos 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. PRICE (Thousands of dollars per fire engine) 150 135 - 120 106 60 45 15 0 + Carlos 0 1 True + 2 False Demand + 6 3 4 5 7 QUANTITY (Fire…
- 5) Calculate the arc price elasticity of demand for wheat in the two situations below: Farmer Brown's Wheat Old price; $3.40/bu Old quantity; 28,000 bu The Wheat Market Old price; $3.40/bu Old quantity; 2.5 billion bu New price; $3.20/bu New price; $3.20/bu New quantity; 2.525 billion bu New quantity; 35,000 bu Can you account for the difference in elasticities?1. Suppose you are given the following information about the demand for vinyl records: P = 60 – 1.5QD a) Suppose the price increases from $15 to $30, what is the arc elasticity of demand? b) Suppose the price decreases from $30 to $ 15, what is the arc elasticity of demand? c) How does you answer from part (a) and (b) compare with the point elasticity of demand when price is $15? What about when price is $30?Please solve my question soon I will give you like Demand for Corn Flakes is: P = 11 - Q. Supply of Kellogg's Corn Flakes is: P = 2 + Q. Now a generic company enters the market, selling generic Corn Flakes for $8. Assume consumers are indifferent between generic and Kellogg's Corn Flakes. How many boxes of corn flakes will sell in total (both brand and generic)? Enter as a value.
- 5. If Reebok Shoes (RS) experiences a decrease in popularity, which of the following would happen? a shift in the Demand curve for RS to the right a movement along the demand curve for RS, downward and to the right a shift in the supply curve of RS to the right a shift in the Demand curve for RS to the left no shift in the Demand curve for RS1. The demand function for a certain brand of CD is given by p = -0.01x² - 0.2x + 10 where p is the unit price in dollars and x is the quantity demanded each week, measured in units of a thousand. The supply function is given by p = 0.01x² + 0.2x + 4 where p is the unit price in dollars and x stands for the quantity that will be made available in the market by the supplier, measured in units of a thousand. Determine the producers' surplus if the market price is set at the equilibrium price. (Round your answer to the nearest dollar.)You operate your own business selling college t-shirts, The demand equation for your t-shirts is as follows: Q = 50 – 2P. a. Calculate the own-price elasticity of demand when the price equals $10 per shirt. o. Interpret this elasticity. c. Categorize this elasticity. %3|
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