For most products, higher prices result in a decreased demand, whereas lower prices result in an increased demand. Let d = annual demand for a product in units p = price per unit Assume that a firm accepts the following price-demand relationship as being realistic: d = 1,000 - 12p where p must be between $20 and $80. (a) How many units can the firm sell at the $20 per-unit price? At the $80 per-unit price? units at $20 per-unit = units at $80 per-unit = (b) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26? From $43 to $44? From $66 to $67? What is the suggested relationship between the per-unit price and annual demand for the product in units? (i) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26? units at $25 per-unit = units at $26 per-unit =
For most products, higher prices result in a decreased demand, whereas lower prices result in an increased demand. Let d = annual demand for a product in units p = price per unit Assume that a firm accepts the following price-demand relationship as being realistic: d = 1,000 - 12p where p must be between $20 and $80. (a) How many units can the firm sell at the $20 per-unit price? At the $80 per-unit price? units at $20 per-unit = units at $80 per-unit = (b) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26? From $43 to $44? From $66 to $67? What is the suggested relationship between the per-unit price and annual demand for the product in units? (i) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26? units at $25 per-unit = units at $26 per-unit =
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![For most products, higher prices result in a decreased demand, whereas lower prices result in an increased demand. Let
d =
annual demand for a product in units
p = price per unit
Assume that a firm accepts the following price-demand relationship as being realistic:
d = 1,000 - 12p
where p must be between $20 and $80.
(a) How many units can the firm sell at the $20 per-unit price? At the $80 per-unit price?
units at $20 per-unit
units at $80 per-unit =
=
(b) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26? From $43 to $44? From $66 to $67?
What is the suggested relationship between the per-unit price and annual demand for the product in units?
(i) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26?
units at $25 per-unit =
units at $26 per-unit =
(ii) What happens to annual units demanded for the product if the firm increases the per-unit price from $43 to $44?
units at $43 per-unit =
units at $44 per-unit
=](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff6875d1f-7585-44e5-8edc-ec261e6aff7a%2F2790778f-05d6-4d71-bbf6-ce936cd562a9%2Fpnxvvrc_processed.png&w=3840&q=75)
Transcribed Image Text:For most products, higher prices result in a decreased demand, whereas lower prices result in an increased demand. Let
d =
annual demand for a product in units
p = price per unit
Assume that a firm accepts the following price-demand relationship as being realistic:
d = 1,000 - 12p
where p must be between $20 and $80.
(a) How many units can the firm sell at the $20 per-unit price? At the $80 per-unit price?
units at $20 per-unit
units at $80 per-unit =
=
(b) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26? From $43 to $44? From $66 to $67?
What is the suggested relationship between the per-unit price and annual demand for the product in units?
(i) What happens to annual units demanded for the product if the firm increases the per-unit price from $25 to $26?
units at $25 per-unit =
units at $26 per-unit =
(ii) What happens to annual units demanded for the product if the firm increases the per-unit price from $43 to $44?
units at $43 per-unit =
units at $44 per-unit
=
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