a) Describe the relationship between elasticity and total revenue when considering an increase in price. You are the manager of a train company. Recently total sales have been a bit low and you are now considering means to give sales a boost. Market research has shown that currently the price of train tickets is historically low. Market research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. b) One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you Explain with her? agree why. c) She continues her argument by concluding that if the demand goes up, the total value of sales of train tickets should therefore increase. Do you agree with Explain her? why.

a) Describe the relationship between elasticity and total revenue when considering an increase in price. You are the manager of a train company. Recently total sales have been a bit low and you are now considering means to give sales a boost. Market research has shown that currently the price of train tickets is historically low. Market research has also shown that the demand curve for train tickets is downward sloping. You may assume that your company is not a price taker on the market. b) One of your colleagues has suggested that it is important to lower the price of train tickets. In that case, she argues, the demand will increase. Do you Explain with her? agree why. c) She continues her argument by concluding that if the demand goes up, the total value of sales of train tickets should therefore increase. Do you agree with Explain her? why.

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

The capital share in Peru is a = 2/3. Relative to last year, capital in- creased by 20%, labor hours increased by 10%, and total output increased by 25%. Which is the closest approximation number for the growth in Total Factor Productivity, A? (a) -5% (b) 11.6% (c) 8.3% (d) 0%
(c) Indicate a (license) fee, in pesos per day, that the government could charge to achieve the socially efficient (i.e. profit maximizing) number of wells.
Need help with two sub part mc question as it can be answered
What is the intervention process for a distressed project? (a) Requirements gathering and work breakdown structure construction(b) Conduct the earned value analysis (c) Conduct the earned value analysis and root cause analysis (d) None of the above
a b C $40; $40 $40; zero $150,000; $150,000 zero; $40
K L Q MPL APL (Q/L) VML (MPL*P) FC VC (L*150) TC 5 0 0 0 0 5 1 50 50 50 50 25 150 175 5 2 125 75 62.5 150 25 300 325 5 3 225 100 75 200 25 450 475 5 4 375 150 93.7 300 25 600 625 5 5 450 75 90 150 25 750 775 5 6 450 0 75 0 25 900 925 5 7 400 -50 57.14 -100 25 1050 1075 5 8 425 -75 53.12 -150 25 1200 1225 5 9 450 -25 50 -50 25 1350 1375 5 10 500 -50 50 -100 25 1500 1525 5 11 525 25 47.7 50 25 1650 1675 Define firm’s fixed costs. Next, what is Firm’s FC in the Table above. Why?
A country’s per-capita nominal GDP is growing at 5%, its price level is growingat 3% and its population is growing at 1%. How fast is its aggregate real GDPgrowing?(a) 2%(b) 3%(c) 4%(d) 5%
An assembly line can produce 80 units per hour. The line's hourly cost is $4250 on straight time (the first 8 hours). Workers are guaranteed a minimum of 5 hours. There is a 35% premium for overtime, however, productivity for overtime drops by 10%. What are the average and marginal costs per unit for the following daily quantities? (a) 350 (b) 500 (c) 640 (d) 850
In terms of total number of businesses by form of ownership, corporations are more common than sole proprietorships. ( a) True ( b) False
Herbert Hoover's response to the Great Depression included O establishing the Reconstruction Finance Corporation in 1932. (A) O a belief that government should step in to help when American business could not O a belief in volunteerism from the private sector. (C) Both A and B. O Both A and C.
Preference decisions compare potential projects that meet screening decision criteria and will be ranked in their preference order to differentiate between alternatives with respect to all of the following characteristics except_ A. political prominence B. feasibility C. desirability D. importance
(b) What is the break-even sales in RM for an operation that sells 615 products at RM 17.50 if each item costs RM 7.05 to produce and the fixed costs for the operation are RM 3,700/month? A company sells 900 units/month at RM 49.99 each, with an RM 18.12 per-unit cost and RM 2,175 monthly fixed costs. Determine whether this company making a profit or not? (c) (d) Zyleron Corp. shows monthly fixed costs of RM 37,210 and a per-unit cost of RM 34.79. It sells 275 units in a month. Calculate what is the minimum price Zyleron Corp. must sell each unit for to break even?