User Account

All Pages

Compute the price elasticity of demand between two points

Assignment Help Business Economics
Reference no: EM131968262

Economics

Suppose you are the manager of a restaurant that serves an average of 400 meals per day at an average price per meal of $20. On the basis of a survey, you have determined that reducing the price of an average meal to $18 would increase the quantity demanded to 450 per day.

  1. Compute the price elasticity of demand between these two points.
  2. Would you expect total revenues to rise or fall? Explain.
  3. Suppose you have reduced the average price of a meal to $18 and are considering a further reduction to $16. Another survey shows that the quantity demanded of meals will increase from 450 to 500 per day. Compute the price elasticity of demand between these two points.
  4. Would you expect total revenue to rise or fall as a result of this second price reduction? Explain.
  5. Compute total revenue at the three meal prices. Do these totals confirm your answers in (b) and (d) above?

Reference no: EM131968262

Questions Cloud

Reflect on how you will evaluate primary sources : Reflect on how you will evaluate primary sources differently from secondary sources. Why would you evaluate them differently?
How would the supply and demand curve shift : In order for private investment to go and price go down, how would the supply and demand curve shift? This is during a budget deficit. Please help.
Immigration policy in australia changes that leads : Please Explain the effect of the following on: (i) the Aggregate Production Function (make sure you both show graphically and explain why) (ii) GDP
Complete the feminist section in the worksheet : Directions: Below is a matrix you will use throughout this course to gather and organize information. It is suggested you save this document for future use.
Compute the price elasticity of demand between two points : Suppose you have reduced the average price of a meal to $18 and are considering a further reduction to $16. Another survey shows
Analyze the error in the conclusion : Analyze the error in the conclusion. Given: There is a linear correlation between the number of cigarettes smoked and the pulse rate.
What is the present value of the installment payment plan : What's the present value of the installment payment plan, assuming that the proper annual discount rate is 7.00%?
What is the amount that felix will have to pay each month : What is the amount that Felix will have to pay each month in order to reach a $0 balance on his 48th payment?
What is break-even cost per kilowatt-hour : You require a return of 11 percent and use a light fixture 500 hours per year. What is the break-even cost per kilowatt-hour?

Reviews

Write a Review

Business Economics Questions & Answers

  What about longer term dynamics of the global economy

What about longer term dynamics of the global economy? What might be those benefits or losses

  Budget constraint changes graphically

Suppose further that the consumerâs income increases to $60. Show how the budget constraint changes graphically.

  New child labor law

Connect Andrew Carneige's Wealth and it's Issues and Mother Jones' March of the Mill Children to a larger theme or idea. How do these two documents relate to each other? Wealth and it's Issues talks about how Carneige believes the wealth should be di..

  Economic conditions of the two decades

Write an annotated bibliography for my economic class. Two pages long

  Charge of monetary policy

Suppose you are in charge of monetary policy. Assume your goals are a full employment level of production with price stability. Assume further the economy has excess capacity with unemployment at 7.8% (the natural rate is 5.2%), but you are concerned..

  Raise the economic welfare of countries

Do you think that Business practices in an Islamic country are likely to differ from Business practices in the United States? If so, how? Recognize why many economics believe that unrestricted free trade between nations will raise the economic welfar..

  Explain how the law of demand affected your purchase

Think about a product that you have purchased recently (e.g. soda, diapers, takeout meals, milk, shoes, manicure/pedicure, video game, etc.). Explain how the law of demand affected your purchase. Give specific examples of how the determinants of dema..

  Accessibility to the healthcare system

Do the structure, cost, spending, and accessibility to the healthcare system in the US serve the long-term economic growth path?

  Post-war economy-military spending

How could I phrase my thesis to sound more persuasive with the following subject matter: the past economic decline of Vietnam veterans, post-war economy

  What was the growth rate of total factor productivity

From 1990 to 2004, the Celtic Tiger, Ireland, experienced annual growth in RGDP of 6.4% while the capital stock grew at 4.8% per year and employment grew at 2% annually. Labor’s share of Income was 60%. What was the growth rate of Total Factor Produc..

  Wrongness of action is determined by these consequences

Jane just finished a Pepsi and is wondering what to do with the can. She takes a moment and thinks about the actions available to her, and decides that she can either recycle the can or throw it on the ground. the rightness or wrongness of an action ..

  Pricing in a managerial environment

1. Discuss the issues and difficulties associated with pricing in a managerial environment.

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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