Suppose demand for hamburgers is: Q = 16 − P 2. a) How many hamburgers do...
Suppose demand for hamburgers is: Q = 16 − P 2.
a) How many hamburgers do you sell if the price is P = 2? What is your total revenue?
b)What is the elasticity of demand for hamburgers at P = 2? Is demand on the elastic or inelastic region of the demand curve?
c) Suppose price increases by 10%. Use the elasticity of demand to show what you expect to happen to quantity (roughly). Use this to predict what will happen to total revenue and explain why
Homework Answers
Add Answer to:
Suppose demand for hamburgers is: Q = 16 − P 2.
a) How many hamburgers do...
2. Demand and supply equations for Good X is given as: Demand: P=6 - (1/50) Q...
2. Demand and supply equations for Good X is given as: Demand: P=6 - (1/50) Q and Supply: P= 1 + (1/100) Q [P: Price, Q: Quantity] i. Given the above information find the equilibrium price and quantity for Good X. ii. What is the point elasticity of demand at equilibrium? Is it elastic, inelastic or unitary elastic? iii. What is the point elasticity of supply at equilibrium? Is it elastic, inelastic or unitary elastic? iv. If the price increases...
Suppose the demand curve for iPads takes the functional form: Q^d(P) = 500 – 10P; what...
Suppose the demand curve for iPads takes the functional form: Q^d(P) = 500 – 10P; what is the own price elasticity of demand when the price is $30? Is the own price elasticity of demand for iPads elastic E >1, inelastic E < 1, or unitary elastic E = 1? And what implications does that outcome have with respect to the producer’s total revenue (TR = PQ)?
Suppose Josh’s elasticity of demand for hamburgers is -1.25. If the price increased 25%, how would...
Suppose Josh’s elasticity of demand for hamburgers is -1.25. If the price increased 25%, how would Josh's hamburger purchases change? increase hamburger purchases by 31.25 percent decrease hamburger purchases by 31.25 percent. increase hamburger purchases by 20.1 percent decrease hamburger purchases by 20.1 percent increase hamburger purchases by 1.25% decrease hamburger purchases by 1.25% Question 3 Suppose the price of steak dropped from $10.00/lb to $9.00/lb. If steak is inelastic over this range, we would expect Total revenue of steak...
7. Suppose the demand for lychees is given by the following equation: 100P 500PM, where P...
7. Suppose the demand for lychees is given by the following equation: 100P 500PM, where P is the price of lychees and P, is the price of mangoes What happens to the demand for lychees when the price of mangoes goes up? Are lychees and mangoes substitutes or complements? a. b. Graph the demand curve for lychees when Pu2 Now suppose that the quantity of lychees supplied is given by the following equation: 1500P- 60R, where R is the amount...
2. (10 points) The demand of a product v depends on ts own price P). and...
2. (10 points) The demand of a product v depends on ts own price P). and the price of another product x (P.). The price elasticity of yvise-a.s, and ne cross-price elastiety with respect to X is o. (a) Are X and Y substitutes or complements? (b) Suppose now P, increases by 2%, and P" decreases by 5%. Will the quantity demanded of V increase or decrease? By what percent? 3. (20 points) The demand function of cigarettes is linear...
For the demand function q =D(P) = 340 - p, find the following. a) The elasticity...
For the demand function q =D(P) = 340 - p, find the following. a) The elasticity b) The elasticity at p = 105, stating whether the demand is elastic, inelastic or has unit elasticity c) The value(s) of p for which total revenue is a maximum (assume that p is in dollars) a) Find the equation for elasticity E(p) = 0 b) Find the elasticity at the given price, stating whether the demand is elastic, inelastic or has unit elasticity....
of 2. (30 points) The demand of a product y depends on its own price UP...
of 2. (30 points) The demand of a product y depends on its own price UP ), and the price another product X (P. The price elasticity of Yis e,ー3.5, and the cross-price elasticity of Y with respect to X is e0.8. (a) Are X and Y substitutes or complements? lete (b) Suppose now P, increases by 2%, and r, decreases by 5%. Will the quantity demanded of Y increase or decrease? By what percent? 3. (20 points) The demand...
16. Suppose that the price of one product increases from $11 to $42. As a result,...
16. Suppose that the price of one product increases from $11 to $42. As a result, quantity demanded for another product changes from 260 to 180. Based on this information you can tell that these two products are (select one): a. complements b. normal C. substitutes d. inferior 17. Suppose that when the store increases the price of laundry detergent from $2.50 to $3.90, quantity demanded decreased from 210 to 130. What is the change in total revenue as a...
7. Suppose the inverse demand equation for rental apartments is P = 2000 – Q and...
7. Suppose the inverse demand equation for rental apartments is P = 2000 – Q and the inverse supply equation for rental apartments is P=Q. Suppose there's a policy that restricts the price (monthly rental) to not exceed $1200. Which of the following statement is correct? A. The market equilibrium price will be $1200. B. There will be no excess demand or excess supply. C. There will be an excess demand of 400 units. D. There will be an excess...
Figure: The Demand Curve Figure: The Demand Curve Price 3104 Quantity Use Figure: The Demand Curve....
Figure: The Demand Curve Figure: The Demand Curve Price 3104 Quantity Use Figure: The Demand Curve. By the midpoint method, the price elasticity of demand between $6 and $7 is approximately 1.86. 0.19. 1.00 5.40. If the absolute value of the price elasticity of demand is greater than 1: percentage changes in the price will lead to equal percentage changes in the quantity demanded. small percentage changes in the price will lead to much larger percentage changes in the quantity...
2. Demand and supply equations for Good X is given as: Demand: P=6 - (1/50) Q and Supply: P= 1 + (1/100) Q [P: Price, Q: Quantity] i. Given the above information find the equilibrium price and quantity for Good X. ii. What is the point elasticity of demand at equilibrium? Is it elastic, inelastic or unitary elastic? iii. What is the point elasticity of supply at equilibrium? Is it elastic, inelastic or unitary elastic? iv. If the price increases...
7. Suppose the demand for lychees is given by the following equation: 100P 500PM, where P is the price of lychees and P, is the price of mangoes What happens to the demand for lychees when the price of mangoes goes up? Are lychees and mangoes substitutes or complements? a. b. Graph the demand curve for lychees when Pu2 Now suppose that the quantity of lychees supplied is given by the following equation: 1500P- 60R, where R is the amount...
2. (10 points) The demand of a product v depends on ts own price P). and the price of another product x (P.). The price elasticity of yvise-a.s, and ne cross-price elastiety with respect to X is o. (a) Are X and Y substitutes or complements? (b) Suppose now P, increases by 2%, and P" decreases by 5%. Will the quantity demanded of V increase or decrease? By what percent? 3. (20 points) The demand function of cigarettes is linear...
For the demand function q =D(P) = 340 - p, find the following. a) The elasticity b) The elasticity at p = 105, stating whether the demand is elastic, inelastic or has unit elasticity c) The value(s) of p for which total revenue is a maximum (assume that p is in dollars) a) Find the equation for elasticity E(p) = 0 b) Find the elasticity at the given price, stating whether the demand is elastic, inelastic or has unit elasticity....
of 2. (30 points) The demand of a product y depends on its own price UP ), and the price another product X (P. The price elasticity of Yis e,ー3.5, and the cross-price elasticity of Y with respect to X is e0.8. (a) Are X and Y substitutes or complements? lete (b) Suppose now P, increases by 2%, and r, decreases by 5%. Will the quantity demanded of Y increase or decrease? By what percent? 3. (20 points) The demand...
16. Suppose that the price of one product increases from $11 to $42. As a result, quantity demanded for another product changes from 260 to 180. Based on this information you can tell that these two products are (select one): a. complements b. normal C. substitutes d. inferior 17. Suppose that when the store increases the price of laundry detergent from $2.50 to $3.90, quantity demanded decreased from 210 to 130. What is the change in total revenue as a...
7. Suppose the inverse demand equation for rental apartments is P = 2000 – Q and the inverse supply equation for rental apartments is P=Q. Suppose there's a policy that restricts the price (monthly rental) to not exceed $1200. Which of the following statement is correct? A. The market equilibrium price will be $1200. B. There will be no excess demand or excess supply. C. There will be an excess demand of 400 units. D. There will be an excess...
Figure: The Demand Curve Figure: The Demand Curve Price 3104 Quantity Use Figure: The Demand Curve. By the midpoint method, the price elasticity of demand between $6 and $7 is approximately 1.86. 0.19. 1.00 5.40. If the absolute value of the price elasticity of demand is greater than 1: percentage changes in the price will lead to equal percentage changes in the quantity demanded. small percentage changes in the price will lead to much larger percentage changes in the quantity...
Most questions answered within 3 hours.
-
Anchor Company purchased a manufacturing machine with a list
price of $85,000 and received a 2%...
asked 1 minute from now -
Suppose there are 2 firms in an industry with marginal abatement
cost curves:
MACA = 400...
asked 16 minutes ago -
Calculate the equilibrium pH for a buffer that consists of 0.35M
weak acid (HA) and 0.65M...
asked 18 minutes ago -
Kathy spends $10 a week on lottery tickets. She wants to know
how much she would...
asked 19 minutes ago -
we discussed a number of factors in the "General (remote)
Environment" that can affect the...
asked 40 minutes ago -
Using the IS-PC-MR model, describe how the economy responds to
an inflation shock in the following...
asked 41 minutes ago -
Ammonium nitrate has been used as a high explosive because it is
unstable and decomposes into...
asked 45 minutes ago -
How long would it take a car with a top speed of 203 mph to travel...
asked 44 minutes ago -
9) What are the two different ways in which a user can interact
(interface/work) with UNIX?...
asked 48 minutes ago -
Exercise 2.5. Use the Binomial Theorem to prove that, for all n
≥ 0 and for...
asked 1 hour ago -
The teachers at Bryan ISD want to examine if a newly developed
intervention program for disadvantaged...
asked 1 hour ago -
Describe the
characteristics of small business.
- Name the most
common causes of small business failure....
asked 1 hour ago