You face demand P=240 - 2Q^D. You have cost function: TC= 100 + 20Q. 1.) What is the revenue-maximizing price? 2.) What is the profit-maximizing price? 3.) What is the profit at the profit-maximizing price?
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- The average ticket price for a concert at the opera house was $30. The average attendance was 5000. When the ticket price was raised to $33, attendance declined to an average of 4700 persons por performance. What should the ticket price be to maximize revenue for the opera house? (Assume a linear demand curve.) To maximize revenue, the price should be $ por ticket. (Type an integer or decimal rounded to two decimal places as needed. Simplify your answer.)Consider the supplier of a product that is an inferior good. For instance, an aluminum supplier for a canned goods producer. During a recession during which average incomes fall, which of the following best describes what would happen to the profit-maximizing price of the supplier? a. The supplier’s profit-maximizing price would decrease due to an increase in demand. b. The supplier’s profit-maximizing price would increase due to an increase in demand. c. The supplier’s profit-maximizing price would decrease due to a reduction in demand. d. The supplier’s profit-maximizing price would increase due to a reduction in demand.Demand for Corn Flakes is: P = 24- Q. Supply of Kellogg's Corn Flakes is: P = 2+ Q. Now a generic company enters the market, selling geneen Corn Flakes for $7. Assume consumers are indifferent between generic and Kellogg's Cororlakes. How many boxes of Kellogg's (brand) Corn Flakes will sell? Enter as a value.
- QUESTION 1 Firms A, B, and C were all selling 1,000 cups of coffee per day at $3.50 per cup, but in the following week they all changed their prices. This gave their managers some information about the elasticity of demand in their local market, though they have to be careful to recognize that other factors might also have affected demand. The table below shows the change in sales as a result of their new prices; they made no other changes. Complete the table by calculating the revenue, cost of goods sold (COGS), and gross margin for each firm. Firm Baseline A B C Price per Cup $3.50 $3.00 $4.00 $2.50 Cups Sold 1,000 1,140 830 1,500 Revenue $3,500 $0 0 0 COGS @ $0.35 per Cup $350 $0 $0 $0 Gross Margin $3,150 $0 $0 $0 Coffee prices are going up, and Firm B is trying to decide whether to pass on to customers a cost increase of 10¢ per cup-to $0.45 per cup. What will be their new gross margin if they don't pass on the cost increase and demand remains unchanged? $ 0 What will be their new…QUESTION 3 Explain the term price elasticity of demand?How is it measured? If the price elasticity is -3 and RM 200 is the marginal cost of product X,what should be the optimal sale price? (Hint:apply the mark -up rule)When you compare the absolute value of the price elasticity of demand for most products [Hint, oil is one product that works this way.] in the long run (20 years) vs absolute value of the elasticity of demand for the products in the short run (6 months), the absolute value of the long run price elasticity of demand is... [Note: we consider demand elasticity positive, even though they're technically negative. In other words, for purposes of this question, "greater" means farther away from zero] a) less than that of the short run. In the long run, this elasticity will always be very close to zero b) not zero, but less than that of the short run c) equal to that of the short run d) greater than that of the short run
- A) Compute the elasticity of demand for x = D(p) = 40000 − 100p at p = 300. B) Find the price p that should be charged to maximize revenue.Question 2 The weekly demand function for bubble tea at Bobo Tea Malaysia is: P = 200- 4Q where Q is the number of cups per week and P is the price per cup of bubble tea. Bobo Tea is considering decrease its price below the current price of $20. But the company is unwilling to decrease its price if the price fall will cause revenue to fall. (a) Calculate its price elasticity of demand for bubble tea at the current price of $20 per cup. (b) Based on your answer in part (a), should Bobo Tea decrease its price below $20 per cup? Explain with economic reasoning.A company produces a special new type of TV. The company has fixed costs of $468,000, and it costs $1400 to produce each TV. The company projects that if it charges a price of $2400 for the TV, it will be able to sell 750 TVs. If the company wants to sell 800 TVs, however, it must lower the price to $2100. Assume a linear demand. What price should the company charge to earn a profit of $742,000?
- 1. The demand function for a certain brand of CD is given by p = -0.01x² - 0.2x + 10 where p is the unit price in dollars and x is the quantity demanded each week, measured in units of a thousand. The supply function is given by p = 0.01x² + 0.2x + 4 where p is the unit price in dollars and x stands for the quantity that will be made available in the market by the supplier, measured in units of a thousand. Determine the producers' surplus if the market price is set at the equilibrium price. (Round your answer to the nearest dollar.)2: The price elasticity of demand for Nanay Flor's Photography is 0.5. If the %AQ=10%. What is the %AP? Why do you think nanay flor's service is inelastic? How can she maximize profit? 3: Mamon's bakery is famous for its Banana muffins. If they will increase the price from P10 to P15 and the price elasticity of supply is 1.5. How much will the %AQ? Suggest ways to maximize profit. 4: Company X developed a mobile application that could track monthly expenses of households. If the launching price is P500 and due to good response from the market the company strategist suggested to increase the price to P700.lf the %AQ= 30%. As the CEO, will you approve the price increase?