Macroeconomics, Student Value Edition (6th Edition)
6th Edition
ISBN: 9780134126081
Author: R. Glenn Hubbard, Anthony Patrick O'Brien
Publisher: PEARSON
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Chapter 3, Problem 3.3.7PA
To determine
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In 1896, Colgate dental cream was introduced in tubes similar to those we use now. Today, the Colgate-Palmolive Company’s brand of toothpaste is the best-selling toothpaste in the world (ahead of the Crest brand marketed by Procter & Gamble, which was introduced in 1955).
While Colgate and Crest enjoy the lion’s share of the toothpaste market, if you view the oral care shelf at your local drugstore or supermarket, you will find over a hundred different varieties of toothpaste. Colgate alone sells over 40 different varieties that are marketed under names ranging from Shrek Bubble Fruit to Colgate Total Advanced Whitening.
The high level of product differentiation in the toothpaste market stems from firms introducing new varieties in an attempt to boost their economic profits. In environments where makers of other brands (such as Crest) can easily enter profitable segments of the market, a profitable strategy is to attempt to quickly cover that segment (introducing Shrek Bubble Fruit…
In 1896, Colgate dental cream was introduced in tubes similar to those we use now. Today, the Colgate-Palmolive Company’s brand of toothpaste is the best-selling toothpaste in the world (ahead of the Crest brand marketed by Procter & Gamble, which was introduced in 1955). While Colgate and Crest enjoy the lion’s share of the toothpaste market, if you view the oral care shelf at your local drugstore or supermarket, you will find over a hundred different varieties of toothpaste. Colgate alone sells over 40 different varieties that are marketed under names ranging from Shrek Bubble Fruit to Colgate Total Advanced Whitening.
The high level of product differentiation in the toothpaste market stems from firms introducing new varieties in an attempt to boost their economic profits. In environments where makers of other brands (such as Crest) can easily enter profitable segments of the market, a profitable strategy is to attempt to quickly cover that segment (introducing Shrek Bubble…
1.) GM’s Food Shops has completed a study of weekly demand for its “new-fashioned” tacos in 53 regional markets. The study revealed that where Q is the number of tacos sold per store per week, A is the level of local advertising expenditure, Pop denotes the local population (in thousands), and Pr is the average taco price of local competitors. For the typical GM’s outlet, P = P1.50, A = P1,000, Pop = 40, and Pr = P1.
Q = 400 - 1,200P + 0.8A + 55Pop + 800Pr
Estimate the weekly sales for the typical GM’s outlet.
Determine the equilibrium price and equilibrium quantity, if supply is Qs = 700 + 1,200P considering the general demand function of GM’s outlet
Should GM raise its taco prices? Why or why not?
Chapter 3 Solutions
Macroeconomics, Student Value Edition (6th Edition)
Ch. 3 - Prob. 1TCCh. 3 - Prob. 2TCCh. 3 - Prob. 3.1.1RQCh. 3 - Prob. 3.1.2RQCh. 3 - Prob. 3.1.3RQCh. 3 - Prob. 3.1.4RQCh. 3 - Prob. 3.1.5RQCh. 3 - Prob. 3.1.6PACh. 3 - Prob. 3.1.7PACh. 3 - Prob. 3.1.8PA
Ch. 3 - Prob. 3.1.9PACh. 3 - Prob. 3.1.10PACh. 3 - Prob. 3.1.11PACh. 3 - Prob. 3.1.12PACh. 3 - Prob. 3.1.13PACh. 3 - Prob. 3.1.14PACh. 3 - Prob. 3.1.15PACh. 3 - Prob. 3.1.16PACh. 3 - Prob. 3.1.17PACh. 3 - Prob. 3.2.1RQCh. 3 - Prob. 3.2.2RQCh. 3 - Prob. 3.2.3RQCh. 3 - Prob. 3.2.4PACh. 3 - Prob. 3.2.5PACh. 3 - Prob. 3.2.6PACh. 3 - Prob. 3.2.7PACh. 3 - Prob. 3.2.8PACh. 3 - Prob. 3.2.9PACh. 3 - Prob. 3.3.1RQCh. 3 - Prob. 3.3.2RQCh. 3 - Prob. 3.3.3RQCh. 3 - Prob. 3.3.4PACh. 3 - Prob. 3.3.5PACh. 3 - Prob. 3.3.6PACh. 3 - Prob. 3.3.7PACh. 3 - Prob. 3.3.8PACh. 3 - Prob. 3.3.9PACh. 3 - Prob. 3.4.1RQCh. 3 - Prob. 3.4.2RQCh. 3 - Prob. 3.4.3PACh. 3 - Prob. 3.4.4PACh. 3 - Prob. 3.4.5PACh. 3 - Prob. 3.4.6PACh. 3 - Prob. 3.4.7PACh. 3 - Prob. 3.4.8PACh. 3 - Prob. 3.4.9PACh. 3 - Prob. 3.4.10PACh. 3 - Prob. 3.4.11PACh. 3 - Prob. 3.4.12PACh. 3 - Prob. 3.4.13PACh. 3 - Prob. 3.4.14PACh. 3 - Prob. 3.4.15PACh. 3 - Prob. 3.4.16PACh. 3 - Prob. 3.4.17PACh. 3 - Prob. 3.4.18PA
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