A local pizzeria sells 500 large pepperoni pizzas per week at a price of $20 each. Suppose the owner of the pizzeria tells you that the price elasticity of demand for his pizza is -3, and he asks you for advice. He wants to know two things. First, how many pizzas will he sell if he cuts his price by 10%? Second, how will his revenue be affected? If he cuts his price by 10%, his sales will increase to______pizzas, and his total revenue will increase to $ _____
A local pizzeria sells 500 large pepperoni pizzas per week at a price of $20 each. Suppose the owner of the pizzeria tells you that the price elasticity of demand for his pizza is -3, and he asks you for advice. He wants to know two things. First, how many pizzas will he sell if he cuts his price by 10%? Second, how will his revenue be affected? If he cuts his price by 10%, his sales will increase to______pizzas, and his total revenue will increase to $ _____
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A local pizzeria sells 500 large pepperoni pizzas per week at a
If he cuts his price by 10%, his sales will increase to______pizzas, and his total revenue will increase to $ _____.
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