Answer 4, 5 and 6. Thank You! Imagine you are the owner of a business manufacturing and selling a particular type of table in the home furnitureindustry.The average variable costs of producing each table are £180 while the fixed costs are £12,000.Also, you have carried out some market research and found that the total number of customers wishing to buy the tablevaries with changes in price of the table as shown below:Product. TablePrice (E) Quantity Demanded100140770680610180220260300550500460340380400320Q1) Calculate total revenues at different prices.Q2) Which price would yield the greatest revenue?Q3) Draw the demand curve for the tablesPrice (E)100Quantity supplied2201402601803202204002605003006403408803801400 Q4) Draw a supply curve for the tables on the same diagram as the demand curve you have drawn for Q3.Q5) On the supplyldemand diagram find the equilibrium price and equilibrium quantities sold/bought.Q6) Would you make a loss or profit by selling the equilibrium quantity and charging the equilibrium price?Q7) If quantity demanded of tables increases by 180 at all prices, draw the new demand curve and find the newequilibrium price and quantities.Also, identify and explain specific factors which might have caused an increase in the demand for tables.Q8) Calculate your new sales and revenues at all prices and all corresponding higher new quantities demanded.Q9) How much would your loss or profit be at the new equilibrium price?Q10) Now, assume that the new equilibrium price you have worked out in Q7 above is the price you are going tocharge in the following 2 years, that is, January 2017 to December 2018. You have estimated your sales in these2 years to be as follows:MonthsJan.-Apr.May-Aug.2017Sep.-Dec.Jan.- Apr.2018May-Aug.2018Sep.-Dec.201820172017Units sold500550600800950700Using the data above and the data on costs of production given below, produce:i)a sales revenue budget for each of the 4 months periods stated above (i.e. Jan. to April 2017, etc.)ii)a production budget for each of the 4 months periods stated above (i.e. Jan. to April 2018) assuming averagevariable costs are £180 per table and fixed costs are £1000 per montha profit budget for each of the 4 months periods stated aboveiii)

Answer: (4). Graphical presentation of the demand and supply curves: According to the above figure,…

Q4) Draw a supply curve for the tables on the same diagram as the demand curve you have drawn for Q3. Q5) On the supplyldemand diagram find the equilibrium price and equilibrium quantities sold/bought Q6) Would you make a loss or profit by selling the equilibrium quantity and charging the equilibrium price?

Q4) Draw a supply curve for the tables on the same diagram as the demand curve you have drawn for Q3. Q5) On the supplyldemand diagram find the equilibrium price and equilibrium quantities sold/bought Q6) Would you make a loss or profit by selling the equilibrium quantity and charging the equilibrium price?

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

Chapter14: Pricing Techniques And Analysis

Section: Chapter Questions

Problem 1E

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