7. (Figure 10.5) Suppose that a firm offers customers either (1) the ability to buy any quantity they desire for $24 per unit or (2) a price of $18 per unit for 15 or more than under the $24-per-unit pricing scheme, so the plan to charge these types of consumers a price of units. Consumer surplus under the quantity discount is $24 per unit is_____ compatible. Price (S) 40- 30- 24 20- 18- 10- 0 6 8 10 12 14 16 18 20 22 Quantity 11 15 $64 more; incentive $32 less; not incentive $53 less; incentive O $41 more; not incentive

7. (Figure 10.5) Suppose that a firm offers customers either (1) the ability to buy any quantity they desire for $24 per unit or (2) a price of $18 per unit for 15 or more than under the $24-per-unit pricing scheme, so the plan to charge these types of consumers a price of units. Consumer surplus under the quantity discount is $24 per unit is_____ compatible. Price (S) 40- 30- 24 20- 18- 10- 0 6 8 10 12 14 16 18 20 22 Quantity 11 15 $64 more; incentive $32 less; not incentive $53 less; incentive O $41 more; not incentive

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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8.
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6. The variety of demand curves The following graph displays four demand curves (PP, QQ, RR, and SS) that intersect at point V. PRICE (Dollars per unit) 20 18 16 14 12 10 po 4 2 19 0 # + 0 P 2 D +XX W R + + 4 6 > S + S N 8 10 12 QUANTITY (Units) R P + + → 14 16 18 20 (? Using the graph, complete the table that follows by indicating whether each statement is true or false. Statement Between points V and Y, curve RR is inelastic. Between points V and W, curve PP is unit elastic. Curve QQ is more elastic between points V and X than curve RR is between points V and Y. True False