Worldwide annual sales of smart phones in over a five-year period were projected to be approximately q=-10p+4440 million phones at a selling price of $P per phone.Obtain a formula for the price of elasticity of demand E.In one particular year the actual selling price was $271 per phone. What was the corresponding price elasticity of demand?Use your formula for E to determine the selling price that would’ve resulted in the largest annual revenue. What, nearest to the nearest 10 million, would have been the resulting annual revenue? **Tutorial Exercise**---Worldwide annual sales of smartphones in over a 5 year period were projected to be approximately \[ q = 10^6p^{-1} + 4.440 \] million phones at a selling price of $p per phone.### (a) Obtain a formula for the price elasticity of demand $ E $.### (b) In one particular year the actual selling price was $271 per phone. What was the corresponding price elasticity of demand? Interpret your answer.### (c) Use your formula for $ E $ to determine the selling price that would have resulted in the largest annual revenue. What, to the nearest $10 million, would have been the resulting annual revenue?

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Answered: Tutorial Exercise Worldwide annual…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Worldwide annual sales of smart phones in over a five-year period were projected to be approximately q=-10p+4440 million phones at a selling price of $P per phone. Obtain a formula for the price of elasticity of demand E. In one particular year the actual selling price was $271 per phone. What was the corresponding price elasticity of demand? Use your formula for E to determine the selling price that would’ve resulted in the largest annual revenue. What, nearest to the nearest 10 million, would have been the resulting annual revenue?

**Tutorial Exercise**

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Worldwide annual sales of smartphones in over a 5 year period were projected to be approximately
\[ q = 10^6p^{-1} + 4.440 \]
million phones at a selling price of $p per phone.

### (a) Obtain a formula for the price elasticity of demand $ E $.

### (b) In one particular year the actual selling price was $271 per phone. What was the corresponding price elasticity of demand? Interpret your answer.

### (c) Use your formula for $ E $ to determine the selling price that would have resulted in the largest annual revenue. What, to the nearest $10 million, would have been the resulting annual revenue?

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