Creative Homework/Short Project Assume that you arean entrepreneur who runs a bakery that sells glutenfree breads and cakes. You believe that the currenteconomic conditions merit an increase in the price ofyour baked goods. You are concerned, however, thatincreasing the price might not be profitable becauseyou are unsure of the price elasticity of demand for yourproducts. Develop a plan for the measurement of priceelasticity of demand for your products. What findingswould lead you to increase the price? What findingswould cause you to rethink the decision to increaseprices? Develop a presentation for your class outlining(1) the concept of elasticity of demand, (2) why raisingprices without understanding the elasticity would bea bad move, (3) your recommendations for measurement, and (4) the potential impact on profits for elasticand inelastic demand
Creative Homework/Short Project Assume that you are
an entrepreneur who runs a bakery that sells glutenfree breads and cakes. You believe that the current
economic conditions merit an increase in the
your baked goods. You are concerned, however, that
increasing the price might not be profitable because
you are unsure of the price elasticity of
products. Develop a plan for the measurement of price
elasticity of demand for your products. What findings
would lead you to increase the price? What findings
would cause you to rethink the decision to increase
prices? Develop a presentation for your class outlining
(1) the concept of elasticity of demand, (2) why raising
prices without understanding the elasticity would be
a bad move, (3) your recommendations for measurement, and (4) the potential impact on profits for elastic
and inelastic demand
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