Reference no: EM1329146
Just answers the questions below using some economic concepts.
1.) Find a real world example depicting price elasticity of demand. Be sure to explain how the concept of price elasticity demand would impact the seller's revenues should the seller choose to raise the price of the product. Please do not use the example for the questions below, use something else.
2.) Please give comment and what you think? An example of price elasticity of demand would be parking fees. I work Monday through Friday in an office located in downtown San Diego. There are lots that are owned by companies who charge different prices for the different parts of the day. When I get to work early (before 8am), I pay a 'reasonable' fee of $6 for the day. When I come after 8am and anytime before 5pm, I pay $9. And it gets worse. If it is Friday evening, from 6pm on, these same lots charge $12. As a result of these prices, many people I work with try to get to work as early as possible to take advantage of the special discount. Also, when spending time in downtown, there are quite a few people that get there before 5pm to save the extra dollars in parking fees. Kind of inconvenient, but you get a great parking space and save some money!
3.) Please give comment and what you think? If the prices of coke rises dramatically people would tend to buy less of it if none at all, since this is not a product that is a necessity (except for in my family, who buy it no matter how much it costs). People would wait to purchase this item until the price is reasonable or "right" for them. This represents the price elasticity of demand.
4.) Please give comment and what you think? What I have noticed is that there is a high demand for Louis Vuitton bags even though they are so expensive. What comes to my mind is that if they lower their prices in some of their styles, more people are going to be able to buy their products instead of buying immitations which i think more people is able to buy. I know this is a recognized brand but if they come up with less expensive styles let say from $500 to $300 they are still going to make a good profit and increase their sales.