only Iv please Illustrate and explain how the shortage of chips will impact the market for (i)chips and (ii) motor vehicles.i.ii.Is demand for (i) chips and (ii) motor vehicles elastic or price inelastic? Explainyour reasoning.iii.Discuss one factor EACH that you think influence elasticity of demand andsupply for chips. Provide examplesExplain how revenue for the producers of (i) chips and (ii) motor vehicles will beimpacted by the shortage in chips.iv. Samsung Electronics Co. Ltd said on Thursday it expects chip shortages to affect chipdemand from some customers in the final three months of the year, after reporting itshighest quarterly profit in three years. The warning comes as producers of goods fromtelevisions to cars have faced a host of supply chain issues ranging from a shortage oflogic chip parts, manpower shortages, logistics snarls, and delays at parts plants due topower cuts in China.Samsung said demand for server DRAM chips, which temporarily save data, andNAND flash chips that serve the data storage market, is expected to stay robust in thefourth quarter due to expansion of data Centre investments. Although supply chainissues could limit demand from some mobile chip customers in the fourth quarter,demand for server and personal computer chips is expected to be robust in 2022 despiteuncertainties, it said.Analysts expect Samsung's fourthquarter earnings to be level or below its third quarterresult, largely depending on memory chip prices. Smaller rival SK Hynix on Tuesdaystruck a more optimistic note than U.S. peers and forecast steady demand for memorychips.

Given, Samsung Electronics expects a shortage in chips which may effect the demand for some…

Answered: Explain how revenue for the producers…

Business

Economics

Explain how revenue for the producers of (i) chips and (ii) motor vehicles will be impacted by the shortage in chips.

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

You are a manager in charge of monitoring cash flow at a major publisher. Paper books comprise 50 percent of your revenues, which grow about 2 percent annually. You recently received a preliminary report that suggests the growth rate in ebook reading has leveled off, and that the cross-price elasticity of demand between paper books and ebooks is −0.4. In 2019, your company earned about $500 million from sales of ebooks and about $500 million from sales of paper books. If your data analytics team estimates the own price elasticity of demand for paper books is −3, how will a 2 percent decrease in the price of paper books affect your overall revenues from both paper books and ebooks sales? Instructions: Enter your response rounded to one decimal place. Your overall revenues will change by $_______ million.
An analyst for FoodMax estimates that the demand for its Brand X potato chips is given by ln QdX = 12.14 – 2.8 ln PX + 3.4PY + 0.7 ln AX, where Qx and PX are the respective quantity and price of a four-ounce bag of Brand X potato chips, PY is the price of a six-ounce bag sold by its only competitor, and AX is FoodMax’s level of advertising on Brand X potato chips. Last year, FoodMax sold 7 million bags of Brand X chips and spent $0.42 million on advertising. Its plant lease is $2.1 million (this annual contract includes utilities) and its depreciation charge for capital equipment was $2.8 million; payments to employees (all of whom earn annual salaries) were $0.8 million. The only other costs associated with manufacturing and distributing Brand X chips are the costs of raw potatoes, peanut oil, and bags; last year FoodMax spent $2.8 million on these items, which were purchased in competitive input markets. Based on this information, what is the profit-maximizing price for a bag of…
You are a manager in charge of monitoring cash flow at a major publisher. Paper books comprise 40 percent of your revenues, which grow about 2 percent annually. You recently received a preliminary report that suggests the growth rate in ebook readings has leveled off, and that the cross-price elasticity of demand between paper books and ebooks is -0.3. In 2016, your company earned about $600 million from sales of ebooks and about $400 million from sales of paper books. If the own price elasticity of demand for paper books is -2, how will a 4 percent decrease in the price of paper books affect your overall revenues from both paper books and ebooks sales? (Enter your response rounded to one decimal place.) Your overall reveues will change by $____ million.
You are a manager in charge of monitoring cash flow at a major publisher. Paper books comprise 40 percent of your revenues, which grow about 2 percent annually. You recently received a preliminary report that suggests the growth rate in ebook reading has leveled off and that the cross-price elasticity of demand between paper books and ebooks is –0.3. In 2016, your company earned about $600 million from sales of ebooks and about $400 million from sales of paper books. If the own price elasticity of demand for paper books is –2, how will a 4 percent decrease in the price of paper books affect your overall revenues from both paper book and ebook sales?
Vina Technology makes LCD display for mobile phones. In 2020 they sold 10,000 units at $400 each. Vina Technology have determined that the midpoint price elasticity for the LCD displays is −4.33. In 2021, Vina Technology is planning to increase the price of the LCD displays to $500. Forecast sales volume for 2021 assuming that all other things remain the same.
The demand equation for a particular candy bar is px + x + 20p = 3000 where 1000x candy bars are demanded per week when p dollars is the price per bar. If the current price of the candy is 49 dollars per bar and the price per bar is increasing at the rate of 0.2 dollars each week, find the rate of change in the demand.
Recently, the spot market price of U.S. hot rolled steel plummeted to $400 per ton. Just one year ago, this same ton of steel cost $700. According to Metals Monitor, the drop in price was due to falling oil prices, along with a rise in cheap imports and excess capacity. These dramatic market changes have greatly impacted the supply of raw steel. Suppose that last year the supply for raw steel was QSraw = 600 + 4P, but this year it has shifted to QSraw= 4,200 + 4P. Assuming the market for raw steel is competitive and that the current worldwide demand for steel isQdraw = 9,000 – 8P, compute the equilibrium price and quantity for the steel market one year ago, and the equilibrium price–quantity combination for the current steel mar ket. Suppose the cost function of a representative steel producer is C(Q) = 1,200 + 15Q2. Compare the change in the quantity of raw steel exchanged at the market level with the change in raw steel produced by a representative firm. How do you explain this…
The demand for an economics textbook is given by: Q = 796 - 3p^2 Find the value of Q1 when demand is unit elastic and hence calculate the new price (rounded to two decimal positions) needed to increase Q by 100 units from the Q1 value. Note: Express the new price with two decimal positions (avoid intermediate roundings in the calculation process).
You own Earthworm Excavators. Your company is the sole manufacturer of super-sized excavators that are used in the world’s largest mining operations. The U.S. has recently lifted export restrictions on the product you sell, so you can now sell your equipment in the world market along with sales in the domestic market. You hire an economist to estimate the following (inverse) demand curves per year for these distinct markets: Domestic market : Pd = $1200 - $10QdForeign market : Pf = $600 - $5Qf where P refers to prices charged in each market in thousands of dollars and Q refers to the annual quantities demanded in each market. The total costs (in thousands of dollars) of your annual operation are given by: TC = 900 + 200Q a. If you decide to offer you machines at a single price to all potential buyers, at what price will the foreign buyers be priced out of the market?b. What is the market demand function if you decide to offer the machines to all potential buyers at a single…
. According to the Department of Statistics Malaysia (DOSM) in 2020, the production to five economics sectors namely services, manufacturing, agriculture, mining, and quarrying; and construction registered a contraction with a highly challenging domestic operating environment and lower global demand in response to Covid-19 Pandemic as shown in FIGURE 1. Therefore, it is putting into pressure especially to the Small-Medium Enterprises (SME) in Malaysia for making pricing decision on its products or services in relations to a firm's total revenue. briefly evaluate THREE (3) effects on a firm's total revenue in response between percentage change in quantity demanded for a goods or services with respect to the percentage change in price based on specific economics sectors
The quantity demanded of the commodity in the market is 25 units when the selling price per unit is P12. Derive the demand equation given that because of the decrease in price to P8 per units, the quantity demanded increased to 60 units.
Revenue at a major smartphone manufacturer was $1.4 billion for the nine months ending March 2, up 97 percent over revenues for the same period last year. Management attributes the increase in revenues to a 137 percent increase in shipments, despite a 17 percent drop in the average blended selling price of its line of phones.Given this information, is it surprising that the company’s revenue increased when it decreased the average selling price of its phones? a. Yes. Own price elasticity is −0.12, which means demand is inelastic and a decrease in price will decrease revenues. b. Yes. Own price elasticity is −8.06, which means demand is elastic and a decrease in price will decrease revenues. c. No. Own price elasticity is −8.06, which means demand is elastic and a decrease in price will raise revenues. d. No. Own price elasticity is −0.12, which means demand is elastic and a decrease in price will raise revenues.