The management of Titan Tire company has determined that the quantity demanded x of their Super Titan tires per week is related to the unit price p by the following equation where p is measured in dollars and x in units of a thousand. I= VTT-p (0
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- 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.demand for a product is related to its selling price P (in dollars) by the equation n=2800-100p where n is the number of fans that can be sold per month at a price P. Find the selling price that will maximize the revenue.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.
- If 100 units of product K are sold at a unit price of $10 and 75 units of product Kare sold at a unit price of $15, one can conclude that in this price range:A) demand for product K is elastic.B) demand for product K is inelastic.C) demand for product K has shifted to the right.D) consumers are sensitive to price changes of product K.A store that sells maize meal discovers that when the price of 1kg maize meal Is R24 per kilogram, the quantity demanded is 306 kgs per week. When the price decreases to R21 per kg, then the sales increase to 340 kgs per week.the demand for boneless chicken breast, in dollars per pound, is given by q=-0.7p+5, where p represents the price per pound and q represents the average number of pounds purchased per week per customer. Determine the price at which the demand for boneless chicken breast is unit elastc.
- These questions require application of economic theory relating to elasticity of demand andsupply. All calculations must be shown in full. Answer ALL the questions.Q.3.1 A store that sells maize meal discovers that when the price of 1kg maize meal IsR24 per kilogram, the quantity demanded is 306 kgs per week. When the pricedecreases to R21 per kg, then the sales increase to 340 kgs per week. Use thisinformation to answer questions Q.3.1.1 and Q.3.1.2 below.Q.3.1.1 Determine the price elasticity of maize meal using the Arc method. (5)Q.3.1.2 Discuss the relationship between the price elasticity of maize mealand the total revenue the store received from the sales. Advise thestore on an appropriate pricing strategy.(7)Q.3.2 The store selling maize meal makes a further discovery, when the price of ricechanges from R30 per kg to R26 per kg, then the quantity of rice demandeddecreases from 1360 kg per month to 1238 kg per month. Use this informationto answer Q.3.2.1 and Q.3.2.2 below.Q.3.2.1…Given: The ATV Company produces a specialty cement used in the construction of roads. ATV is a price-setting firm and estimates the demand for its cement using a demand function in the linear form: Q = f( P, M, PR) where Qc = demand for cement/month (in yards) Pc = the price of cement per yard, M = country’s tax revenues per capita, and PR = the price of asphalt per yard. The manager of ATV obtained the following results in her attempt to estimate the demand for cement in the succeeding months. The results are presented below: DEPENDENT VARIABLE Qc R- SQUARE F-RATIO P-VALUE ON F OBSERVATIONS 64 0.8093 84.872 0.0001 VARIABLE PARAMETER ESTIMATE STANDARD ERROR T-RATIO P-VALUE INTERCEPT 8.20 4.01 2.04 0.0461 PC…The price for cigarettes sold by Big Tobacco Co Ltd was 6.00 per packet in March 2018. During the month of March, the consumption of cigarettes was 1000 packets. However, the Board of Directors of Big Tobacco Co Ltd decided to increase the price by 25% during the month of April. As a manager you noted that price elasticity of demand was 0.8. As a manager Big Tobacco Co Ltd: As a manager Big Tobacco Co Ltd store advise your management of the strategy that could be adopted by your firm to maintain sales
- Consider two goods, product A and product Q. The price of product A increases from R6 to R8 per unit and as a result the quantity demanded of product Q decreases from 200 to 190 units. Calculate the cross-price elasticity of demand, using the arc elasticity formula, given the information above. Show all calculationsVina 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.