Your current prices are $311 in the southwestern region; $278 in the western-region and $240 in the New England region. Your marginal cost is now $212.21.
Your current prices are $311 in the southwestern region; $278 in the western-region and $240 in the New England region. Your marginal cost is now $212.21.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Your current prices are $311 in the southwestern region; $278 in the western-region and $240 in the New England region. Your marginal cost is now $212.21. Given the predicted changes in the quantity demanded by region per problem 1 and using the stay even analysis %ΔQd = %ΔP/[%ΔP + ((P-MC)/P)], can you raise the price by 7% in any of the regional markets? State you conclusion and then show all the steps supporting your conclusion. (Note you are not being asked to compute the new price.)
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I can not get 7.2, 7.8 or 8.3 when I do the calculations. How did you get them?
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