A manufacturer sells two related products, the demand for which is characterized by the following two demand functions: q1 = f1 (p1, p2) = 200 – 6p1 – p2 q2 = f2 (p1, p2) = 150 – p1 – 4p2 where pj equals price (in dollars) of product j and qj equals the demand (in thousands of units) product j. (a) How many units are expected to be demanded of each product if $18/unit is charged for product 1 and $36/unit is charged for product 2? (b) How many units are expected if the units price are $40 and $30, respectively?

A manufacturer sells two related products, the demand for which is characterized by the following two demand functions: q1 = f1 (p1, p2) = 200 – 6p1 – p2 q2 = f2 (p1, p2) = 150 – p1 – 4p2 where pj equals price (in dollars) of product j and qj equals the demand (in thousands of units) product j. (a) How many units are expected to be demanded of each product if $18/unit is charged for product 1 and $36/unit is charged for product 2? (b) How many units are expected if the units price are $40 and $30, respectively?

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)

14th Edition

ISBN:9781305506381

Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris

Chapter5: Business And Economic Forecasting

Section: Chapter Questions

Problem 6E: The economic analysis division of Mapco Enterprises has estimated the demand function for its line...

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