Suppose that at the equilibrium price and quantity, the marginal revenue is -$15 and the priceelasticity of demand for a linear demand function is -0.75. Then we know that the equilibriumprice is.

A firm maximizes its profit by producing at an output level where the marginal revenue of the firm…

Answered: Suppose that at the equilibrium price…

Micro Economics For Today

10th Edition

ISBN:9781337613064

Author:Tucker, Irvin B.

Publisher:Tucker, Irvin B.

Chapter5: Price Elasticity Of Demand And Supply

Section: Chapter Questions

Problem 24SQ: Suppose that when price is 10, quantity supplied is 20 units, and when the price is 6, the quantity...

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Price elasticity of demand tends to be larger in the long run than in the short run. Which of the following is a reason that this statement is true? a. Over time, peoples incomes rise. b. If price rises, over time, producers will be able to offer more substitutes. c. Over time, the good will become a smaller and smaller share of peoples budgets. d. People see fewer and fewer substitutes for the good in the long run.
If the midpoint on a straight-line demand curve is at a price of $7, what can we say about the elasticity of demand for a price change from $12 to $10? What about from $6 to $4?
Suppose that when price is 10, quantity supplied is 20 units, and when the price is 6, the quantity supplied is 12 units. What is the price elasticity of supply? a. 0.5 b. 0.8 c. 1.0 d. 1.5
You've estimated the market demand curve for the spice market as P=184 - 2Q. What is elasticity of demand for spice at P=49 in absolute terms? Enter a number only.
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What can you conclude about the price elasticity of demand in each of the following statements? a. "The pizza delivery business in this town is very competitive. I'd lose half my customers if I raised the price by as little as 10%." b. "I owned both of the two Jerry Garcia autographed lithographs in existence. I sold one on eBay for a high price. But when I sold the second one, the price dropped by 80%." c. "My economics professor has chosen to use the Krugman/Wells textbook for this class. I have no choice but to buy this book."
Consider a company, StarBreads, that sells bread in a competitive market. The price of bread is currently $3 per loaf, and StarBreads is selling 1000 loaves per day. The company decides to increase the price to $4 per loaf, and as a result, daily sales drop to 800 loaves. Calculate the price elasticity of demand for StarBreads' loaves using the midpoint method.
George has been selling 7,000 T-shirts per month for $7.00. When he increased the price to $9.00, he sold only 6,000 T-shirts. Which of the following best approximates the price elasticity of demand? -0.6769 -0.6154 -0.3077 -0.5538 Suppose George's marginal cost is $4 per shirt. Before the price change, George's initial price markup over marginal cost was approximately . George's desired markup is . Since George's initial markup, or actual margin, was than his desired margin, raising the price was
A hot dog stand finds that if they charge $5 for a hotdog, they sell 100 hotdogs per day. For each 50 cent decrease in price, they sell 20 more hot dogs. Write a demand function for quantity in terms of the price.
Answer plzz...
Viking Publishing House observed that in the recent years books on nature conservation and climate change have been very popular. As a matter of fact, Jane Goodall's latest book, "The Book of Hope: A Survival Guide for an Endangered Planet" has been a best-seller and Viking estimates the following demand curve for the book: P = 150 - Q In this equation, P is the price of the book and Q denotes yearly sales in thousands 20,000 books would be expressed as Q = 20 books. In other words, Viking estimates that it incurs a cost of $40 for printing and shipping of each book and pays a $10 royalty to Jane Goodall for each book sold. a. Calculate the profit maximizing OUTPUT and PRICE for this book. Also, calculate the TOTAL PROFITS.
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Suppose that at the equilibrium price and quantity, the marginal revenue is -$15 and the price elasticity of demand for a linear demand function is -0.75. Then we know that the equilibrium price is: