A local pizza shop owner decides to hire an economic consultant to help him set his prices. Currently, one slice of pizza costs $2 and the store sells about 800 slices per week. The pizza shop's current revenue from sales is equal to $____. The economic consultant estimates that the price elasticity of demand is equal to -0.25, and suggests that the shop owner should increase the price of a slice of pizza by $0.50; that is, the consultant recommends
A local pizza shop owner decides to hire an economic consultant to help him set his prices. Currently, one slice of pizza costs $2 and the store sells about 800 slices per week.
The pizza shop's current revenue from sales is equal to $____.
The economic consultant estimates that the price elasticity of demand is equal to -0.25, and suggests that the shop owner should increase the price of a slice of pizza by $0.50; that is, the consultant recommends increasing the price of pizza by ____%.
The consultant claims that doing so would (a. Increase b. Decrease or C.have no effect on)_____ the number of slices sold by ____% or ____ slices. As a result, the economist predicts that the new revenue would be ____
Thus as a result of the increase in the price there is ____ in revenue. This is due to the fact that the pizza shop owner was operating on the ____ portion of the demand curve.
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