Calculate price elasticity of demand and interpret result

Assignment Help Business Economics
Reference no: EM132173686

When the price of a new Toyota Corolla was $20,000, a dealership sold 15 cars in one week. The car was put on sale with incentives worth $4,000 (cash). As a result, the same dealership sold 22 cars in next week. Calculate price elasticity of demand and interpret your result. You must show your work.

Reference no: EM132173686

Questions Cloud

Financial accountability mean in personal finance : What does the term, "financial accountability" mean in personal finance? What does it mean in government? How is financial accountability served
Describe the client system : Describe the client system.( e.g., individual, family, other small group, larger group) or the practice situation.
Why the drug coverage provided by medicare part d : Why the drug coverage provided by Medicare Part D plans doesn't make sense from an economic standpoint?
Generic drug pricing strategies : Evaluate the impact competitors market structures and economic factors have on the results of the generic drug pricing strategies.
Calculate price elasticity of demand and interpret result : Calculate price elasticity of demand and interpret your result. You must show your work.
Price and quantity of computers : What price and quantity of computers should MichiganSux produce to maximize profits? What long-run adjustments should be anticipated? Explain?
Describe what they identified as the keys to longevity : Describe what they identified as the keys to longevity in marriage. What are your takeaways from the couple that you had not previously considered?
Charge an annual membership fee : Jet.com is a Hoboken, NJ based start-up that calls itself the '...online version of Costco". Prior to starting their site in July, Jet had raised $225 million
What is the focus of the theory : What is the focus of the theory? That is, what aspects of everyday life (or what questions) does the theory address?

Reviews

Write a Review

Business Economics Questions & Answers

  Examine the economic impact of current approaches

Analyze the economic impact of current approaches to controlling air pollution to determine which approach is the most effective. Provide support for your rationale.

  Should wages and salaries be indexed to economic performance

In this discussion, you will explain the role of the business cycle in government and private sector decisions. Data on GDP and economic growth are considered lagging indicators because they report information on what is already known. How reliable a..

  Expansionary-neutral or contractionary monetary policy

Is the Fed currently pursuing an expansionary, neutral, or contractionary monetary policy? What if any difficulties do you think may be encountered in implementing the current policy.

  Comparing depreciation methods

Use a spreadsheet to develop a depreciation schedule showing the machine's depreciation allowance and book value over its depreciable life.

  Resistance to exchange rate fluctuations

There is resistance to exchange rate fluctuations because changes int he value of a currency are likely to cause all of hte following except.

  Represented by the cobb-douglas utility functions

Consider an economy with two people, Donald and Hillary, and two goods, x and y. Donald is endowed with x¯ units of good x and has none of good y. Hillary is endowed with y¯ units of good y and has no units of good x. Their preferences over these two..

  Labor contract provides for a first-year wage

A labor contract provides for a first-year wage of $15.00 per hour and specified that the real wage will rise by 5 percent in the second year of the contract and by 7.5 percent in the third year. The CPI is 1.00 in the first year, 1.02 in the second ..

  What is the present value of that job

An incoming engineering student (age 18) expects to get a job that pays $53700 per year starting four years from now, and can reasonably expect that that salary will increase at a rate of 3.6% per year throughout his career. If he is planning to reti..

  Reserve requirements associated with existing deposits

It has been determined that, in aggregate, financial institutions with depository accounts currently hold excess reserves equal to $3 billion—that is, they hold $3 billion more than is necessary to meet the reserve requirements associated with existi..

  Consider credit default swap of notional amount

Consider a credit default swap (CDS) of a notional amount $10 million and a term of one year. The CDS spread is 120 basis points and the payment is quarterly. If the bond has not defaulted, calculate the payment from B to A in the first quarter of th..

  Compute the coefficient of price elasticity

What is the formula for measuring the price elasticity of supply? Suppose the price of apples goes up from $20 to $23 a box. In direct response, Goldsboro Farms supplies 1,300 boxes of apples instead of 1,200 boxes. Compute the coefficient of price e..

  The environmental protection agency

The Environmental Protection Agency (EPA) is an independent department with a cabinet level secretary of Environmental Affairs. The Kyoto Protocol had strong support in the U.S. Senate.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd