Problem 1: Ralph advertises to sell cookies for Php 200 a dozen. He sells 75 dozen and decides that he can charge more. He raises the price to Php 300 a dozen and sells 45 dozen. What is the elasticity of demand?

Problem 1: Ralph advertises to sell cookies for Php 200 a dozen. He sells 75 dozen and decides that he can charge more. He raises the price to Php 300 a dozen and sells 45 dozen. What is the elasticity of demand?

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter6: Elasticities

Section: Chapter Questions

Problem 3P

See similar textbooks

Related questions

Q: A firm selling ready meals discovers that the price elasticity of its product is -2.5 and the income…

A: Price elasticity of demand measures the responsiveness of quantity demanded with respect to change…

Q: Calculate the price elasticity of demand using the mid-point method: 1. When there is a movement…

A: ‘Price elasticity of demand(ep)’ refers to the percentage(%) change in quantity(Q) demanded in…

Q: A local council raises the price of car parking from sh 6 to sh10 per day and finds that the usage…

A: The price elasticity of demand is calculated by dividing the percentage change in quantity demanded…

Q: The price of season tickets to a performing arts theater decreases by 3 percent. As a result, the…

A: The price elasticity of demand measures the responsiveness of quantity demanded to a change in…

Q: Q3) Taiwan is a major world supplier of semiconductor chips. A recent earthquake severely damage the…

A: Elasticity is a basic statistic for how responsive an economic variable is to changes in another…

Q: Managers of movie theaters know that the price elasticity of demand for movie tickets is 1.5. If…

A: The firm wants to increase sales which means the quantity demanded for a product increases by 6%.…

Q: The price elasticity of demand for Pete's chocolate chip cookies is 1.5. Pete wants to increase his…

A: Price elasticity of demand refers to the percentage change in the demand for goods and services due…

Q: uppose you are in charge of sales at a pharmaceutical company, and your firm has a new drug that…

A: Elasticity refers to the responsiveness of one variable to changes in another variable; given that…

Q: Mr. Faisal sells Turkish Lamb Shawarma. During December 2019 Faisal sold 10,000 shawarmas at a price…

A: There are different methods that can be used to compute the price elasticity of demand such that…

Q: Previously when Rafiq was earning 30000 tk per month he was consuming 2 unit got X and 2 unit good…

A: Elasticity of demand refers that change in demand due to change in price , so here we calculate the…

Q: When the price of strawberries increase from OMR 7.500 to 9.600, the quantity demanded changes from…

A: The price elasticity of demand shows the responsiveness of change in quantity demand when the price…

Q: Salina advertises her production of home workout supplies. Initially an exercise floor pad is sold…

A: Note: There are multiple sub parts in the question. Hence, we shall answer the first three sub parts…

Q: A recent study determined the following elasticity for Volkswagen Beetles: Price elasticity of…

A: Price elasticity of demand=(-)2 Income elasticity of demand=1.5 Price elasticity of demand tells…

Q: Given that price rise by 3% and the quantity demanded falls by 10% Find the value of elasticity of…

A: elasticity of demand show the change in demand due to change in price , so here we calculate the…

Q: Ralph advertises to sell cookies for Php 200 a dozen. He sells 75 dozen and decides that he can…

A: According to economists, the pricing of some goods is particularly inelastic. That is, lowering the…

Q: Problem 1: Ralph advertises to sell cookies for Php 200 a dozen. He sells 75 dozen and decides that…

A: "Since you have asked multiple questions ,we will solve the first question for you.If you want…

Q: A company's research team finds that the elasticity of demand for a particular item at price p is…

Q: The elasticity of demand is 0.2. Is the demand curve relatively steep or flat? Will a fall in price…

A: Elasticity of demand measures the responsiveness of quantity demanded to changes in price level.

Q: Danny “Dimes” Donahue is a neighborhood’s 9-year-old entrepreneur. His most recent venture is…

A: Price elasticity of demand measures the responsiveness in the quantity demanded of a commodity to a…

Q: Blue berry pharmaceuticals in Bangladesh has decided to increase their yearly spending advertisement…

A: Given information, Initial expenditure on advertisement= 10 million Final expenditure on…

Q: The market prices of apples has increased by 25% and the quantity demanded falls by 10% Calculate…

A: The given information is as follows:- Rise in market price of apple = 25% Fall in quantity demanded…

Q: when the price of a kettle increases from OMR 15 to OMR 20, the quantity demanded drops from 3550…

A: The price elasticity of demand is basically a measurement of how a product's consumption changes in…

Q: See the information provided in the table below: Commodity Original Price New Price Original demand…

A: Commodity A: Original Price New Price Original Demand New Demand 10 11 50 45 Price…

Q: Directions: Solve the following problems. Interpret the results. 1. Christine sells banana banana…

A: Given At price Php 4.00, total sell is 50 pcs and at price Php 6.00, sell is 40 pieces. Formula…

Q: Find the attached file.

A: Demand is the willingness of the consumers for consuming goods and services at different price…

Q: Average income increases from $20,000 to $22,00o. Then, the quantity demanded increases from 5000 to…

A: Income is one of the determinants that affect the demand for a good. There is a positive…

Q: 200 For the demand function q= D(p)=D find the following. (p + 5)3 a) The elasticity b) The…

Q: John owns the Latin Chocolate store. He charges $5 per pound for her hand made chocolate. You, the…

A: John is now the owner of Latin Chocolate store and charging $5/hand made chocolate. Having price…

Q: 1. Compute for the price elasticity of demand using the elasticity formula. Supplement your answer…

A: Qd is the quantity demanded, which is the quantity that the consumers are willing to buy at…

Q: Suppose that as the price of X falls from $4 to $3 and the quantity of X demandec increases from…

Q: Danny "Dimes" Donahue is a neighborhood's 9-year-old entrepreneur. His most recent venture is…

A: At price $2.5, sale = 100 brownies. At price $ 2, sale = 300 brownies. We have to calculate price…

Q: When the local used bookstore prices economics books at Php 150.00 each, they generally sell 70…

A: Given: The initial price of the bookstore is = Php 150 each The quantity sold at this price is = 70…

Q: The elasticity of demand is 1.1. Is the demand curve relatively steep or flat? Will a fall in price…

A: Change in total revenue depends on elasticity of demand .

Q: Question No 4: Calculate the Elasticity of Demand by using Midpoint Formula and find the total…

A: Answer: The formula to calculate the price elasticity of demand using the midpoint method is given…

Q: Question 14 Mike's Mechanic Shop increased its total monthly revenue from $6,500 to $7,200 when it…

A: 14. Given, TR1= $6500 TR2= $7200 P1= $65 P2= $50

Q: Problem 1: Ralph advertises to sell cookies for Php 200 a dozen. He sells 75 dozen and decides that…

A: Ralph advertises to sell cookies for: Php 200 a dozen, P1 = Php 200 He sells 75 dozen, Q1 = 75 dozen…

Q: D. As a result of an economic boom in Calgary, the average income increases from 2,800 to 7,700 per…

A: Hi! Thank you for the question As per the honor code, We’ll answer the first question since the…

Q: When price elasticity of demand is unitary elastic, a slight increase in price will cause total…

A: Terms: Unitary elastic: A given percentage change in price causes an equivalent percentage change in…

Q: The price elasticity of demand for a popular sporting event is 3. If the price of a ticket to this…

A: Price elasticity of demand measures the percentage change in the quantity demanded due to the…

Q: Calculate the price elasticity of demand for both products using the midpoint method. Comment on…

A: In this question:- Product A Product B Initial price $250 $600 initial quantity 280 50…

Q: 3. (20%) Elasticity (related to Total Revenue): (Please show your steps & decision rules) The demand…

A: Note:- Since we can only answer up to three subparts, we'll answer first three. Please repost the…

Q: Revenue and elasticity. The price-demand equation for hamburgers at a fast-food restaurant is x +…

A: Here we can use the following equation for calculating total revenue, TR=P×X Here, P is the price of…

Q: Katherine advertises to sell cookies for $4 a dozen. She sells 50 dozen, and decides that she can…

A: Answer -

Q: ELASTICITY OF DEMAND Scenario 3: I choose Almarai company a. If your company's product has many…

A: a) If there are too many substitute of goods available:- If there are several identical alternatives…

Question

Problem 1: Ralph advertises to
sell cookies for Php 200 a dozen. He
sells 75 dozen and decides that he
can charge more. He raises the price
to Php 300 a dozen and
sells 45 dozen. What is the elasticity
of demand?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps with 1 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.

Similar questions

A city has build a bridge over a river and it decides to charge a toll to everyone who crosses. For one year, the city charges a variety of different tolls and records information on how many drivers cross the bridge. The city thus gathers information about elasticity of demand. If the city wishes to raise as much revenue as possible from the tolls, where will the city decide to charge a toll: in the inelastic portion of the demand curve, the elastic portion of the demand curve, or the unit elastic portion? Explain.
Transatlantic air travel in business class has an estimated elasticity of demand of 0.62, while transatlantic air travel in economy class has an estimated price elasticity of 0.12. Why do you think this is the case?
A movie production company faces a linear demand curve for its film, and it seeks to maximize total revenue from the films distribution. At what level should the price be set? Where is demand elastic, inelastic, or unit elastic? Explain.
Can you think of an industry (or product) with near infinite elasticity of supply in the short term? That is, what is an industry that could increase Qs almost without limit in response to an increase in the price?
The price elasticity of the demand for gasoline is -0.02. The price elasticity of demand for gasoline at Joe’s 66 station is -1.2. Explain what might account for the different elasticities.
According to the previous discussion, what factors influence the price elasticity of demand for cigarettes? What other factors not mentioned in the article might influence the price elasticity of demand for cigarettes?
Suppose Erin, the owner-manager of a local hotel projects the following demand for her rooms: a. Calculate the price elasticity of demand between 90 and 110. b. Is the price elasticity of demand between 90 and 110 elastic, unit elastic, or inelastic? c. Will Erins total revenue rise if she increases the price from 90 to 110? d. Calculate the price elasticity of demand between 110 and 130. e. Is the price elasticity of demand between 110 and 130 elastic, unit elastic, or inelastic? f. Will Erins total revenue rise if she increases the price from 110 to 130?
The supply of paintings by Leonardo Da Vinci, who painted the Mona Lisa and The Last Supper and died in 1519, is highly inelastic. Sketch a supply and demand diagram, paying attention to the appropriate elasticities, to illustrate that demand for these paintings will determine the price.
From the data in Table 5.6 about supply of alarm clocks, calculate the price elasticity of supply from: point J to point K, point L to point M, and point N to point P. Classify the elasticity at each point as elastic, inelastic, or unit elastic.
Would you usually expect elasticity of demand or supply to be higher in the short run or in the long run? Why?
Explain why using the midpoint formula for calculating the elasticity of demand gives the same result whether price increases or decreases, but using the initial price and quantity instead of the average does not.
Describe the general appearance of a demand or a supply tune with zero elasticity.