Illustrate what will be the new evel of quantity demanded

Reference no: EM1328878

Explanation to "Price Elasticity" question

High-Time, Inc. manufactures medium proceed plastic wrist watches. High-time is considering lowering the price of its watches from the current $14 per unit to $10 per unit. High-Time currently sells 18,500 units per month. The firm's marketing department estimates the price elasticity of demand to be -2.5 over this price range.

a. If High-Time lowers the price, will the total revenue increase, decrease, or remain unchanged? Why?

b. If High-Time lowers the price, what will be the new evel of quantity demanded? Of the new revenue?

Reference no: EM1328878

Questions Cloud

Description of present value of lump sum : What is the future value of lump sum at the end of year 5? What is the future value of mixed stream at the end of year 5? Based upon your findings in parts (a) and (b), which alternative should Gina take?

Difference between the typed password and "phoenix" : explain difference between the typed password and "Phoenix".

Public leader deciding issues : How does a public leader decide which issues to address and when? Can a public leader keep everybody happy?

The impacts of the sp downgrade on the us & global economy : Standard & Poor's downgraded the U.S.'s AAA credit rating for the first time, slamming the nation's political process and criticizing lawmakers for failing to cut spending or raise revenue enough to reduce record budget deficits.

Illustrate what will be the new evel of quantity demanded : If High-Time lowers the price, Illustrate what will be the new evel of quantity demanded. Of the new revenue

Compare and contrast cisc architecture and risc architecture : how to Compare and contrast CISC architecture and RISC architecture.

Present value analysis : Rita Gonzales won the $60 million lottery. She is to get $1 million a year for the next 50 years plus an additional lump sum payment of $10 million after 50 years. The discount rate is 10 percent. What is current value of her winnings?

Explain effect of e-business on consumer behavior : Explain Effect of E-business on Consumer Behavior and what consumer behavior research tools are available for organizations that utilize e-business technologies

Discuss the last product or service you purchased : Discuss the last product or service you purchased that did not perform or deliver as expected, the result of your frustration, and your willingness to purchase this product again.

User Account

All Pages