Microeconomics For Today (MindTap Course List)
9th Edition
ISBN: 9781305507111
Author: Irvin B. Tucker
Publisher: Cengage Learning
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Question
Chapter P3, Problem 8KC
To determine
The long run profit of the monopolistically competitive firm.
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HW Ch5
Calculate the daily total revenue when the market price is $180, $160, $140, $120, $100, $80, $60, and $40 per bippitybop. Then, use the green
point (triangle symbol) to plot the daily total revenue against quantity corresponding to these market prices on the following graph.
2
@
3840
3520
3200+
2880
2560+
2240
TOTAL REVENUE (Dollars)
1920
1600
1280
960 +
640+
0
0 8
16
24
32
40 48 56
64
72
80
QUANTITY (Bippitybops per day)
Total Revenue
?
According to the midpoints formula, the price elasticity of demand between points A and B on the initial graph is approximately .
Suppose the price of bippitybops is currently $60 per bippitybop, shown as point A on the initial graph. Because the price elasticity of demand between
points A and B is
, a $20-per-bippitybop decrease in price will lead to
MacBook Air
in total revenue per day.
F2
80
F3
#3
$
4
5
6
F6
<
F7
* 8
&
27
DII
8
F8
F9
F10
61
0
W
E
R
T
Y
U
0
P
S
D
LL
F
G
H
J
K
L
Chapter P3 Solutions
Microeconomics For Today (MindTap Course List)
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