solution plz The Pear company sells a smart phone for $250. Its sales have averaged 8,000 units permonth over the last year. Recently, its closest competitor Banana company reduced the priceof its smart phone from $350 to $300. As a result, Pear's sales declined by 1,500 units permonth.(a) What is the cross price elasticity of demand between the Pear and Banana smart phone?Use the averaging formula. What does this indicate about the relationship between the twoproducts?(b) If the Pear company knows that the price elasticity of demand for its phone is -1.5, whatprice would the Pear company have to charge to sell the same number of units as it did beforethe Banana company price cut? Assume that Banana company holds its price of its phoneconstant at $300. Use the averaging formula.

The Pear company sells a smart phone for $250. Its sales have averaged 8,000 units per month over the last year. Recently, its closest competitor Banana company reduced the price of its smart phone from $350 to $300. As a result, Pear's sales declined by 1,500 units per month.

The Pear company sells a smart phone for $250. Its sales have averaged 8,000 units per month over the last year. Recently, its closest competitor Banana company reduced the price of its smart phone from $350 to $300. As a result, Pear's sales declined by 1,500 units per month.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Related questions

Q: e ore of a gold nine in the Mo ntains, on the average, 0.5 gram of gold per tor thod A of processing…

A: The net value or net profit is the difference between the total profit and the total cost.

Q: 100 90 80 ATC 70 50 30 AVC 20 MC 10 + 0 0 5 10 15 20 25 30 35 40 45 50 QUANTITY (Thousands of pans)…

A: In perfect competition we assume that the marginal cost curve is same as the supply curve. The below…

Q: What is the Original Measure (Base Period)?

A: For comparison with other periods, the base period refers to the period of time used as the basis…

Q: PLS HELP ASAP ON BOTH

A: 1) The correct symbol for a double V-groove weld that must be examined in the field by ultrasonic…

Q: 2-30 Bismarck Manufacturing intends to increase capac- ity through the addition of new equipment.…

A: The Break Even Point is the production level where total revenues equal total expenses. At that…

Q: EXPENSES (Thousands of dollars per day) 10 9 00 09 5 4 of 10 20 30 40 50 60 TIME (Days) The area of…

A: Here, the firm is expanding, its costs are constantly rising. In this figure, we can see that there…

Q: What is Repo rate ? who set repo rate

A: The Repo rate is also known as the repurchase rate.

Q: The owner shop is contemlating adding anew product which will require additional mouthly payment of…

Q: Advantage and Disadvantage of SSS from Government NBFI?

A: We know that SSS is a system of federally funded services and payments and installments to help…

Q: Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of…

A: Externalities: When a firm produces a good sometimes it creates cost or benefits for other firms. If…

Q: The firm's total profit or loss is $ Price, cost $495 $450 $300 $225 205 260 Quantity MC 339 365 ATC…

A: Perfect competition is a market form with a high number of buyers and a high number of sellers.…

Q: Estimate the unit selling price of an item for which the following data is available. Labor 10 hours…

A: The selling price defines the price at which a good or service is offered for sale in the market,…

Q: Download Q4 and generate a model of the annual maintenance expenses based on the age of the bug. If…

A: We can construct a regression model to analyze the relationship between the age of the bus and…

Q: Safety stock in an MRP system A is never needed. B. is used to provide flexibility to meet changing…

A: Economics is a branch of social science that describes and analyzes the behaviors and decisions…

Q: PLABOR МIC $7.00 -S $5.25 $4.50 MVP QLABOR 1000 1500

A: Monopolist equilibrium is found at the intersection marginal input cost curve and Marginal value…

Q: 6. What is the value of X? 72 (a) 2200 (b) 4400 8400 (d) Can't say; insufficient information = con8-…

A: Here, X is the Total Cost (TC) when the input level is 1200.

Q: ТР AP MP a 25,000 500 80 38,500 b d 44,500 e 300 140 200 200 51,300 h i

A: The production function is a mathematical representation of the relationship between the quantity of…

Q: Use the values in the table below to answer the following questions. MC TC АТС 46.47 15.49 20.13 -(…

A: Average total cost is the ratio of total cost and quantity. ATC = TC/Q TC = ATC*Q

Q: What is Ovako Working Postures Analysis System? Explain.

A: Although analysis as a formal idea is a new creation, it has been used in the study of mathematics…

Q: David gets paid $26 per hour and works 60 hours per week. He typically allots himself 80 hours per…

A: Before Change in wage -Original Wage rate = 26 per hour Working hours = 60Total Hours = 80 Leisure…

Q: A certain masonry dam requires 500,000 cu.m. of gravel for its construction. The contractor found…

A: Given: The construction cost is = 500,000 cu.m. To Find: The lesser costs and economically feasible…

Q: IF GVA factor cost = $ 512 Production taxes = $12 then calculate the gross value added at…

A: Basic prices - Cost or price of a product with production taxes.

Q: PLS HELP ASAP ON BOTH

A: References: Koijen, R. S., & Yogo, M. (2022). New perspectives on insurance. The Review of…

Q: Give some examples of the project cash flow?

A: Project cash flow is the net amount associate with a project during a period of time.

Q: Question: When G is assumed to be exogenous (5#), what other methods can you think of to shift the…

A: The IS curve shows the relationship between the level of real GDP and real interest rate. Real…

Q: No. of workers Output Fixed cost Variable cost = 30 x workers TC =FC +VC 0 0 30 0 30 1 50 30 30 60 2…

A: No. of workers Output Fixed cost Variable cost = 30 x workers TC =FC +VC 0 0 30 0 30 1 50 30 30…

Q: With respect to the graph below, if the MARR for this particular scenario were 2%, which altemative…

A: When talking about incremental analysis, it is the analysis of the true cost of an alternative when…

Q: The demand function for a manufacturer's product is D = 80 -3p , where D is the number of units and…

A: D=80-3p Inverse Demand: p=[(80-D)/3] Total Revenue=Price*Quantity TR=pD TR=[(80-D)/3]D TR=80D/3-D2/3…

Q: When, GVA factor cost = $ 512 Production taxes = $12 then calculate the gross value added at…

A: Answer: Given, GVA factor cost = $ 512 Production taxes = $12 The formula to calculate gross value…

Q: lloy of aluminum or steel. There is a 3000 units. Steel costs P3.80 per kg a costs P8.70 per kg. If…

A: *Answer:

Q: What is 1/2% increase of 277000

A: A figure or ratio stated as a fraction of 100 is called a percentage. The percent sign is frequently…

Q: A manufacturing plant wishes to buy a new equipment so the purchasing department did some research…

A: Given that; A company is considering two types of equipment for its manufacturing plant.

Q: Economic Order Quantity

Q: Fill in the missing values: QP TC TB Tprofit MC MB Mprofit ATC AFC AVC 16 500-50 ΝΑ ΝΑ ΝΑ ΝΑ ΝΑ ΝΑ…

A: Fixed cost is the cost that incur even in zero level of production. Total cost is the sum of Fixed…

Q: The graph represents the market for artichokes (in pounds per week) at a Midwest farmers' market.…

A: Economic surplus:- Whenever a seller sells something for more money than he would have been prepared…

Q: find the TP and AP unit TP AP MP 1 20 20 0 2 32 16 12 3 54 18 22 4 26

A: The table is completed as follows.

Q: Tatal Fixed Cost (TFC) Tatal Variable Tatal Cast Ouput AFC AVC ATC I MC (TPP) Cast (TVC) (TC) 40 70…

A: Meaning of Cost: The term cost refers to the situation under which a firm occurs various expenses…

Q: PLS SHOW THE CASH FLOW OF THE PROBLEM NOT THE CASH FLOW OF THE ANSWER.

A: In the cash flow diagram the downward arrows represent the payments while the upward arrows…

Q: Use the values in the table below to answer the following questions. Q TC ATC 1 35.91 9 101.1 10…

A: Total cost (TC) is the cost of producing all the units of output.Total cost is the sum of fixed cost…

Q: Revenue (with VAT) - 360 Costs of sales - 200 Selling costs - 80 Profit from sales (profit +, losses…

A: Given: Revenue with VAT = 360 Costs of Sales = 200 Selling Costs = 80

Question

solution plz

The Pear company sells a smart phone for $250. Its sales have averaged 8,000 units per
month over the last year. Recently, its closest competitor Banana company reduced the price
of its smart phone from $350 to $300. As a result, Pear's sales declined by 1,500 units per
month.
(a) What is the cross price elasticity of demand between the Pear and Banana smart phone?
Use the averaging formula. What does this indicate about the relationship between the two
products?
(b) If the Pear company knows that the price elasticity of demand for its phone is -1.5, what
price would the Pear company have to charge to sell the same number of units as it did before
the Banana company price cut? Assume that Banana company holds its price of its phone
constant at $300. Use the averaging formula.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Property Rights, Bargaining And The Coase Theorem

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

plz solve it within 30-40 mins I'll give you multiple upvote
Why Fundamentals of Engineering Economics?
ect 19 6 Coffee Tuition Pizza Item Streaming TV Vacation (9) Quantity 20 pounds 1 year 150 pizzas 12 months 1 week Inflation Weighting Problem Unit Price $7 4,000 10 30 350 Total Budget Expenditure (Q X P) Item Weight
The laboriousness for the year will be 457000 standard/hours. The planned fund of working time for one worker is 1850 hours per year, and the planned fulfilment of production standards is 105%. Figure out the number of workers.
typing clear no chatgpt used i will give 5 upvotes i need both answers
Calculate the value of no of units sold when total revenue is 7400 and the price per unit is $25
6000– S2 S1 5000 - A 4000– P 3000- H 2000- 1000 S1 3 4 6 7 8 9. 10 Quantity Supplied (in millions) Price ($)
Why is it -1000 at NVP (Beta), not -10000
PLABOR МIC $7.00 -S $5.25 $4.50 MVP QLABOR 1000 1500
p (a) MC ATC MR P* (b) MC ATC MR (c) MC ATC MR
Affordability R109 per week. Proteas (R15) Roses (R8) Lavender (R6) No. MU TU WMU MU TU WMU MU TU WMU 1 40 40 32 32 20 20 2 35 75 26 58 18 3 30 105 24 82 15 4 23 128 (b) 101 12 5 18 146 16 117 9 6 15 161 10 127 6 (c) 7 0 (a) 8 135 0 8 -6 155 (d) 135 -4 9 -15 140 (e) 131 -7 Calculate the average utility of 4 protea flowers. Round off to zero decimal places. Do not forget the word "utils". Blank 1 Blank 1 Add your answer
11