3. (20%) Elasticity (related to Total Revenue): (Please show your steps & decision rules) The demand schedule for a specific computer software is as follows- Please use the relationship between Elasticity and TR (total revenue) to make judgment. Price (per copy of software) Quantity demanded (in million) $630 640 64 61 660 690 59 55 750 765 53 50 775 820 850 49 47 45 43 860 a. What type of elasticity (elastic, inelastic, or others) is this demand if the price of this software decreases from $750 to $640? (2%) explain why and show your steps. b. What type of elasticity (elastic, inelastic or others) is this demand if the price of this software increases from $690 to $765? (2%) explain why and show your steps. c. At what price is total revenue a maximum and what quantity sold? 2% Show your calculation/numbers d. When the price increases from $660 to $775, is the demand for this software elastic or inelastic or others? Explain why. 2% e. When the price decreases from $850 to $765, is the demand for this software lastia

3. (20%) Elasticity (related to Total Revenue): (Please show your steps & decision rules) The demand schedule for a specific computer software is as follows- Please use the relationship between Elasticity and TR (total revenue) to make judgment. Price (per copy of software) Quantity demanded (in million) $630 640 64 61 660 690 59 55 750 765 53 50 775 820 850 49 47 45 43 860 a. What type of elasticity (elastic, inelastic, or others) is this demand if the price of this software decreases from $750 to $640? (2%) explain why and show your steps. b. What type of elasticity (elastic, inelastic or others) is this demand if the price of this software increases from $690 to $765? (2%) explain why and show your steps. c. At what price is total revenue a maximum and what quantity sold? 2% Show your calculation/numbers d. When the price increases from $660 to $775, is the demand for this software elastic or inelastic or others? Explain why. 2% e. When the price decreases from $850 to $765, is the demand for this software lastia

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

2. Engineer need to consider the demand of the product while making business decisions. List the major purpose of demand analysis from the standpoint of business management. Can a manager manipulate all the variables which affect demand, Explain in detail along with different concepts of elasticity of?
23) Suppose the price elasticity of demand for a product is 1.8. If a supplier wants to increase revenue, they shoud (increase or decrease price- SELECT ONE) increase 24) Goods that are considered luxuries tend to be more (price elastic or price inelastic- SELECT ONE)price elastic 25) When the price is increased and total revenues increase, the elasticity of demand is (price elastic or price inelastic- SELECT ONE)price inelastic
22- There is positive relationship between income of the consumers and demand for ______. a. Inferior goods b. Substitute goods c. Complementary goods d. Normal goods
Only typed answer Suppose the price of a good increased from $3 to $4. In response, the consumer has decreased his consumption from 15 units to 10 units. The price elasticity of demand is
Please answer 13 and 14 13. Acme’s best-selling product sells for $50. Its sales and marketing team is trying to decide how to price the product for next year in order to achieve the maximum total revenue from the product, all marketing effects being the same in both years. After some research it determines that its price elasticity is 0.75 at the reasonable price range around its current price. In this situation, Acme should Group of answer choices a. Raise prices b. Match its nearest competitor’s price c. Reduce prices d. Keep prices the same 14. Suppose an investment project has an NPV of $75 million if it becomes successful and an NPV of –$25 million if it is a failure. What is the minimum probability of success above which you should make the investment? Group of answer choices a. 0.50 b. 0.25 c. 0.33 d. 0.10
2- There is negative relationship between income of the consumers and demand for ______. a. Complementary goods b. Substitute goods c. Normal goods d. Inferior goods
USD.46 The amount of time producers and buyers have to adjust to price changes will do what to price elasticity of supply and demand? Price elasticity of supply will be ______________ when suppliers have more time to adjust. Price elasticity of demand will be ______________ when buyers have more time to adjust. Selected answer will be automatically saved. For keyboard navigation, press up/down arrow keys to select an answer. a greater; smaller b greater; greater c smaller; smaller d smaller; greater
Filll in the values in the equation to calculate the PED for the Malabar coffee Price Elasticity of Demand (PED)= abs( % / % )=
Question 4The 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.
5% increase in the price of Burger King resulted in 16% increase in the demand of Hamburger. What is cross elasticity of demand here? a. 3.2 b. 2.8 c. 2.6 d. 4.3
q24- Suppose that at the original price of $200, 40 TVs were sold every week and that when the price rose to $210, quantity demanded fell to 30 TVs. What is the percentage change in price of TVs at the original price? Select one: a. 105 per cent b. 5 per cent c. 50 per cent d. 95 per cent
1. Excise duty is imposed on * Special goods Goods and services Special goods and services Special services