Problem 11-15 (algo)The American Baker's Association reports that annual sales of bakery goods last year rose 15 percent, driven by a 50 percent increasein the demand for bran muffins. Most of the increase was attributed to a report that diets rich in bran help prevent certain types ofcancer. You are the manager of a bakery that produces and packages gourmet bran muffins, and you currently sell bran muffins inpackages of three. However, as a result of this new report, a typical consumer's inverse demand for your bran muffins is now P = 7- 0.5Q.If your cost of producing bran muffins is C(Q) = 2.5Q, determine the optimal number of bran muffins to sell in a single package and theoptimal package price.Instructions: Enter your response for the optimal package price rounded to two decimal places.Optimal package size: 9✔ unitsOptimal package price: $951.75 Ⓡ

Optimal level of price and quantity demanded is the level where there is equilibrium of demand and…

Answered: Optimal package size: 9 Optimal package…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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You were promoted as the manager of a new clean well sanitary store taht sells cleaning and sanitation products wholesale. You recently read in an article that there the price of vitamine to be expected to increase by 20 percent. How will this affect your stores sale of sanitation products Items selected cross price elasticity Food supplement 0.34 Medicines 0.56 Foods 0.09
You were promoted as the manager of a new Clean-Well Sanitary Store that sells cleaning and sanitation products wholesale. You recently read in an article that there the price of vitamins is expected to increase by 20 percent. How will this affect your store's sales of sanitation products? Selected Cross price elasticity Items Food supplements Medicines Foods 0.34 0.56 0.09 NO NEED TO GRAPH, JUST SHOW COMPUTATIONS
Your firm’s research department has estimated the income elasticity of demand for nonfed ground beef to be −1.94. You have just read in The Wall Street Journal that due to an upturn in the economy, consumer incomes are expected to rise by 10 percent over the next three years. As a manager of a meat-processing plant, how will this forecast affect your purchases of nonfed cattle?
When the local used bookstore prices economics books at $15.00 each, they generally sell 70 books per month. If they lower the price to $7.00, sales increase to 90 books per month.Given this information, we know that the price elasticity of demand for economics books is about 0.34, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue. 2.91, and an increase in price from $7.00 to $15.00 results in an increase in total revenue. 2.91, and an increase in price from $7.00 to $15.00 results in a decrease in total revenue. 0.34, and an increase in price from $7.00 to $15.00 results in an increase in total revenue.
Your firm’s research department has estimated the income elasticity of demand for non fed ground beef to be -1.94. You have just read in the Wall Street Journal that due to an upturn in the economy, consumer incomes are expected to rise by 10 percent over the next three years. As a manager of a meat-processing plant, how will this forecast affect your purchases of non fed cattle?
In a small town, there are two bakeries that produce similar types of bread. Bakery A has been in business for several decades and has a loyal customer base. Bakery B is a new entrant in the market, offering similar quality but at slightly lower prices. As a result, some customers have started shifting their purchases to Bakery B. Question:How does the concept of price elasticity of demand apply to the situation between Bakery A and Bakery B, and what factors might influence consumers' decisions to switch their bread purchases?
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Vijay diary is selling flavored milk and buttermilk in packets of 150 ml. The diary sells 2000 packets of flavored milk and 1000 packets of buttermilk everyday. The former is priced at 6 and the latter at 4. A market survey estimates the cross price elasticity (both ways) to be +1.8, and the own price elasticity of flavored milk to be -1.3. The diary is contemplating a 10 percent reduction in the price of flavored milk. Should it go ahead with the price reduction? Could you graphically as well as mathmatically help providing the solution.
A company produces a special new type of TV. The company has fixed costs of $451,000, and it costs $1000 to produce each TV. The company projects that if it charges a price of $2600 for the TV, it will be able to sell 800 TVs. If the company wants to sell 850 TVs, however, it must lower the price to $2300. Assume a linear demand. If the company sets the price at $3800, how much profit can it earn? It can expect to earn/lose $enter your response here. (Round answer to nearest dollar.)
Suppose that the Blinn College Deli is currently selling 500 chef salads per day when the price is $5. Suppose that the own-price elasticity of demand for chef salads is -0.8. As the Deli manager you decide to lower the price by $0.50. Which of the following is most likely to happen? Chef salad sales will fall by approximately 8% and total revenue will be lower. Chef salad sales will rise by approximately 8% and total revenue will be higher. Chef salad sales will fall by approximately 8% and total revenue will be higher. Chef salad sales will rise by approximately 8% and total revenue will be lower.
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The Stopdecay Company sells an electric toothbrush for $25. Its sales have averaged 8,000 units per month over the past year. Recently, its closest competitor, Decayfighter, reduced the price of its electric toothbrush from $35 to $25. As a result, Stopdecay's sales declined by 1,500 units per month. What is the arc cross elasticity of demand between Stopdecay's toothbrush and Decayfighter's toothbrush? -1.61 O 1.61 0.62 O -0.62 The value of the arc cross elasticity between these products suggests that they are If Stopdecay knows that the arc price elasticity of demand for its toothbrush is -1.6, what price would Stopdecay have to charge to sell the same number of units as it did before the Decayfighter price cut? Assume that Decayfighter holds the price of its toothbrush constant at $30. O $30.75 $28.46 $21.96 O $25.00 It Stopdecay does not change its price, the average monthly total revenue would be the same number of units as it did before, the average monthly total revenue would be…

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Optimal package size: 9 Optimal package price: $951.75 units